Japanese firm Toshiba will acquire a major part of Indian-based manufacturer Vijai Electricals’ electricity transmission and distribution (T&D) business for a cash consideration of around $200m to expand its business in India and global market.

To be completed in November 2013, the acquisition will see Toshiba consequently launch a new company, which will take over Vijai’s T&D business and integrate Toshiba’s design and manufacturing technologies for T&D systems.

The new company, which is being positioned as a core production base, will foray into other power-related markets in India, and will help expand Toshiba’s T&D business in the country and the global market. Toshiba already has production bases in Japan, China, Brazil, Russia and South-East Asia.

Toshiba corporate vice-president Takeshi Yokota said that the acquisition will help the company in its target to achieve 20% market share in India within five years as well as strengthen its network worldwide.

The power-related markets the company plans to focus on in India include power electronics systems, such as high voltage direct current power transmission and static var compensators for high voltage networks, and railway power supply systems.

"The acquisition will see Toshiba consequently launch a new company."

Established in 1973, Vijai Electricals manufactures and sells electricity distribution transformers and has expanded its T&D business in 2006 by entering into power transformer and switch gear businesses. It manufactured and delivered the world’s highest voltage class 1,200kV power transformer.

The T&D market size in India is likely to grow to more than $4bn by 2015 and Toshiba is looking to tap the same through the deal.

Image: Vijai manufactures and sells electricity distribution transformers. Photo: courtesy of Vijai Electricals.