Taiwanese electronics maker Foxconn is reportedly seeking partnerships with Indian businesses to fulfil its semiconductor manufacturing plans in the country, moving away from its current joint-venture partner, Vedanta Group.
What Happened? Government officials, worried about Vedanta Group’s financial stability, have suggested that Foxconn find a new partner, sources told the Economic Times.
They added that differences had appeared with Vedanta Group over the changes to be made in reapplying for incentives under the government’s $10 billion (₹82,000 crore) Indian Semiconductor Mission after their first application was reportedly rejected for not meeting the government’s criteria.
Foxconn is in early talks with domestic corporate groups for potential partnerships, with the final decision is in the firm’s hands, government sources told the business daily.
Vedanta has been on a borrowing spree recently as it looks to service a large amount of debt it has accumulated since the sale of its zinc-mining unit to its subsidiary, Hindustan Zinc, fell through. The Anil Agarwal-led firm has even pledged equity to rival Glencore and to Trafigura Group in order to borrow cash.
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On the other hand, Vedanta told the business daily that their partnership with Foxconn was intact.
The joint venture, Vedanta Foxconn Semiconductors Limited (VFSL), has Vedanta Group holding a 67% stake and Foxconn holding the rest.
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