Joint Venture
Joint Venture
new assets by contributing equity. They exercise control over the enterprise and consequently share revenues, expenses and assets. There are other types of companies such as JV limited by guarantee, joint ventures limited by guarantee with partners holding shares. With individuals, when two or more persons come together to form a temporary partnership for the purpose of carrying out a particular project, such partnership can also be called a joint venture where the parties are "coventurers". A joint venture takes place when two parties come together to take on one project. In a joint venture, both parties are equally invested in the project in terms of money, time, and effort to build on the original concept. While joint ventures are generally small projects, major corporations also use this method in order to diversify. A joint venture can ensure the success of smaller projects for those that are just starting in the business world or for established corporations. Since the cost of starting new projects is generally high, a joint venture allows both parties to share the burden of the project, as well as the resulting profits.
EXAMPLES
Sony-Ericsson is a joint venture by the Japanese consumer electronics company Sony Corporation and the Swedish telecommunications company Ericsson to make mobile phones. The stated reason for this venture is to combine Sony's consumer electronics expertise with Ericsson's technological leadership in the communications sector. Both companies have stopped making their own mobile phones. Virgin Mobile India Limited is a cellular telephone service provider company which is a joint venture between Tata Tele service and Richard Branson's Service Group. Currently, the company uses Tata's CDMA network to offer its services under the brand name Virgin Mobile, and it has also started GSM services in some states. Read more: http://wiki.answers.com/Q/Examples_of_joint_ventures#ixzz1n9fdcC1X
one party is transferred to the company and as consideration for such transfer, shares are issued by the company and subscribed by that party. The other party subscribes for the shares in cash.
2. The above two parties subscribe to the shares of the joint venture company in agreed proportion, in cash, and start a new business. 3. Promoter shareholder of an existing Indian company and a third party, who/which may be individual/company, one of them non-resident or both residents, collaborate to jointly carry on the business of that company and its shares are taken by the said third party through payment in cash. Some practical aspects of formation of joint venture companies in India and the prerequisites which the parties should take into account are enumerated herein after. Foreign companies are also free to open branch offices in India. However, a branch of a foreign company attracts a higher rate of tax than a subsidiary or a joint venture company. The liability of the parent company is also greater in case of a branch office. .Government Approvals for Joint Ventures ... All the joint ventures in India require governmental approvals, if a foreign partner or an NRI or PIO partner is involved. The approval can be obtained from either from RBI or FIPB. In case, a joint venture is covered under automatic route, then the approval of Reserve bank of India is required. In other special cases, not covered under the automatic route, a special approval of FIPB is required. The Government has outlined 37 high priority areas covering most of the industrial sectors. Investment proposals involving up to 74% foreign equity in these areas receive automatic approval within two weeks. An application to the Reserve Bank of India is required. Please see Foreign Investment in India - Sector wise Guide for sectorwise guidelines under automatic route. Besides the 37 high priority areas, automatic approval is available for 74% foreign equity holdings setting up international trading companies engaged primarily in export activities. Approval of foreign equity is not limited to 74% and to high priority industries. Greater than 74% of equity and areas outside the high priority list are open to investment, but government approval is required. For these greater equity investments or for areas of investment outside of high priority an application in the form FC (SIA) has to be filed with the Secretariat for Industrial Approvals. A response is given within 6 weeks. Full foreign ownership (100% equity) is readily allowed in power generation, coal washeries, electronics, Export Oriented Unit (EOU) or a unit in one of the Export Processing Zones ("EPZ's"). For major investment proposals or for those that do not fit within the existing policy parameters, there is the high-powered Foreign Investment Promotion Board ("FIPB"). The FIPB is located in the office of the Prime Minister and can provide single-window clearance to proposals in their totality without being restricted by any predetermined parameters. Foreign investment is also welcomed in many of infrastructure areas such as power, steel, coal washeries, luxury railways, and telecommunications. The entire hydrocarbon sector, including exploration, producing, refining and marketing of petroleum products has now been opened to foreign participation. The Government had recently allowed foreign investment up to 51% in mining for commercial purposes and up to 49% in telecommunication sector. The government is also examining a proposal to do away with the stipulation that foreign equity should cover the foreign exchange needs for import of capital goods. In view of the country's improved balance of payments position, this requirement may be eliminated.
A Memorandum of Understanding and a Joint Venture Agreement must be signed after consulting lawyers well versed in international laws and multi-jurisdictional laws and procedures. Before signing the joint venture agreement, the terms should be thoroughly discussed and negotiated to avoid any misunderstanding at a later stage. Negotiations require an understanding of the cultural and legal background of the parties. Before signing a Joint Venture Agreement the following must be properly addressed: Dispute resolution agreements Applicable law. Force Majeure Holding shares Transfer of shares Board of Directors General meeting. CEO/MD Management Committee Important decisions with consent of partners Dividend policy Funding Access. Change of control Non-Compete Confidentiality Indemnity Assignment. Break of deadlock Termination.
The Joint Venture agreement should be subject to obtaining all necessary governmental approvals and licenses within specified period.
REF: http://madaan.com/jointventure.html
1
Frederick, who lives in Houston, Texas, teamed up with John, who lives in Holland, by communicating over the internet. Together, they worked out a plan to help a New York City tour operator increase his tour business. All work is being done on the World Wide Web, and all conversations and 'meetings' accomplished by e-mail.
2
Brian owns a book store. The weatherman at a local TV station wrote a book of local weather statistics. Brian called the manager of the TV station and offered to do a co-operative promotion with the station. They placed the weatherman's book in Brian's store, even had the weatherman do in-store appearances, which resulted in promoting the store's locations for the appearances, in addition to promoting the radio station and the book.
3
Joan owns a successful donut shop. She bases her advertising entirely on trade. She gives boxes of her high-quality donuts to select radio stations for daily giveaways. In return, they speak highly of her donuts on the air. It's not unusual to hear a morning DJ go on and on about how wonderful her product is. She has a rock solid reputation in the community as a result. The cost? A few boxes of donuts that might be surplused anyway.
4
A veterinarian, Elizabeth, wrote a personal note to all her clients advising them that Companion Petstore was having a sale with super discounts on all items. John, the petstore owner, agreed that Elizabeth could offer her clients a further discount when they presented one of Elizabeth's business cards. In return, John promised to place one of Elizabeth's brochures in every bag at the checkout counter.
5
Theo owned his own Trading Card and Comic shop. He catered mostly to school-aged children, and like so many small businesses, inventory was a problem in the beginning. But Theo was a serious collector of sports memorabilia, himself, and decided to joint venture with some of his collector friends. He offered them a share of the profits from buying and selling baseball and other trading cards they had financed. Theo bought cards in case lots with money from the investors and sold the cards in his comic and card shop, then shared the profits when they were all sold.
6
Delores owned Flowers and More, and counted a number of businesses amongst her regular customers - funeral homes, wedding organizers, and so on. As these businesses had grown, so Flowers and More grew. Now, Delores needed a second cool-storage unit to handle the extra demand. Her bank would not agree to finance it, even though the extra equipment would increase sales and boost profitability. What was she to do? This creative florist offered her larger customers a 15% discount if they would give her advance purchase orders for the floral arrangements they were going to buy from her anyway. They agreed. She took the advance orders to a finance company that helped her purchase the cool cabinet she needed.
7
Jean loved animals. She wanted to start a pet-walking service. When pet owners went on vacation, many did not like to leave their animals in a regular kennel, so this businesslady offered to visit her customers' homes several times a day to feed the cat, walk the dog and so on. She thought this would be a business that did not require any up-front expenditure. She soon found out that people were reluctant to let a stranger have access to their home and possessions while they were away. So Jean approached an established kennels with a joint venture proposal. She would offer the service under their name, pay them a commission for every pet cared for, in return for the kennels putting up the money for a surety bond to protect the customers. The kennels agreed. They were able to expand their business by providing a service to customers they would probably have lost anyway, and this enterprising lady got started in her own business with no financial outlay.
8
A Used Car Dealer, Sam, obtained his inventory of used cars from auctions. He made his purchases with money from private investors. These investors were promised a 50/50 share in the profit from selling the cars to the public. This was a wonderful joint venture deal for everyone the dealer had his inventory financed at no interest; the investors had their investments fully secured by the cars; and they were also able to double their money in a very short time with relatively little risk.
9
Denise, a Realtor, has her own real estate program on local talk radio. She has arranged for sponsors to pay the fees charged by the radio station. Denise might have provided her time for free, to gain the exposure, and let the station sell advertising time. For the Realtor who has less drive, appearing regularly as a real estate expert on someone else's show can be just as effective.
10
An enterprising baked goods manufacturer had grown his company by securing good, solid business supplying supermarkets with fresh-baked breads and cakes, and had recently landed a contract with a chain of bakery outlets. He needed new equipment to supply this increased
demand. Mr.Baker was buying approximately $10,000's worth of flour every month, and this would increase to $15,000- $16,000 per month - nearly $200,000 per year! He approached his favorite supplier with a joint venture proposition. He would sign a contract to purchase $800,000's worth of flour over four years if the supplier would provide the $40,000 needed for the new equipment. The supplier agreed. The deal gave the baker free equipment, amounting to a 5% discount on his flour purchases - $40,000 / $800,000 = 5% - and the flour-supplier landed a locked-in, long-term customer. Both were very happy. (Actually, the supplier didn't put up $40,000 cash. He used his good credit to purchase equipment for Mr.Baker and made monthly payments for it, out of the money Mr.Baker paid him for the flour!)
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BHPBilliton is a joint venture with a British Company and an Australian company formed to combine the resources exploration competencies of both companies. Joint ventures are usually formed when two or more companies want to dig stuff out of the ground but cannot afford to do that on their own. Other examples of joint ventures do happen in other industries. Read more: http://wiki.answers.com/Q/What_is_an_example_of_a_joint_venture#ixzz1n9mtiQRN
Former Broken Hill Proprietary Company Limited corporate logo The Broken Hill Proprietary Company Limited, BHP Co. Ltd., BHP, also known as "the Big Australian",[7] was incorporated in 1885, operating the silver and lead mine at Broken Hill in western New South Wales, Australia.[ In 1915, the company ventured into steel manufacturing, with its operations based primarily in Newcastle, New South Wales. The decision to move from mining ore at Broken Hill to open a steelworks at Newcastle was due to the technical limitations in recovering value from mining the 'lower-lying sulphide ores'.[11] The discovery of Iron Knob and Iron Monarch near the western shore of the Spencer Gulf in South Australia combined with the development by the BHP metallurgist A. D. Carmichael of a technique for 'separating zinc sulphides from the accompanying earth and rock' led BHP 'to implement the startlingly simple and cheap process for liberating vast amounts of valuable metals out of sulphide ores, including huge heaps of tailings and slimes up to' 40 ft (12 m) high.[12] The company began petroleum exploration in the 1960s with discoveries in Bass Strait, an activity which became an increasing focus.[13] BHP began to diversify offshore in a variety of projects. One project was the Ok Tedi copper mine in Papua New Guinea, where the company was successfully sued by the indigenous inhabitants because of the environmental degradation caused by the mine operations.[14] BHP had better success with the giant Escondida copper mine in Chile (57.5% owned) and the Ekati Diamond Mine in northern Canada.[15]
The inefficiencies of what was, by global standards, a small steel operation in Newcastle finally caught up with the company and the Newcastle operations were closed in 1999.[16] The 'long products' side of the steel business was spun off to form OneSteel in 2000.[17] In 2001, BHP merged with the Billiton mining company to form BHP Billiton, the largest mining company in the world. In 2002, the 'flat products' steel business was spun off to form BHP Steel. In 2003, BHP Steel changed its name to BlueScope Steel.[18]
[edit] Billiton
Billiton was a mining company whose origins stretch back to 29 September 1860, when the articles of association were approved by a meeting of shareholders in the Groot Keizerhof hotel in The Hague, the Netherlands.[19] Two months later, the company acquired the mineral rights to the tin-rich Billiton (Belitung) and Bangka Islands in the Indonesian archipelago, off the eastern coast of Sumatra.[19] Billiton's initial business forays included tin and lead smelting in the Netherlands, followed in the 1940s by bauxite mining in Indonesia and Suriname. In 1970, Shell acquired Billiton and accelerated the scope of progress of this growth.[19] The tin and lead smelter in Arnhem, the Netherlands, was shut down in the 1990s. In 1994, South Africa's Gencor Ltd. acquired the mining division of Billiton excluding the downstream metal division.[20] Billiton was divested from Gencor in 1997.[21] Bhp Billiton remains one of the largest companies listed on the Johannesburg Stock Exchange (JSE, sharecode bil) in South Africa by market capitalisation. In 1997, Billiton Plc became a constituent of the FTSE 100 Index.[19] in the UK.
Former Billiton corporate logo. Throughout the 1990s and beyond, Billiton Plc experienced considerable growth. Its portfolio included aluminium smelters in South Africa and Mozambique, nickel operations in Australia and Colombia, base metals mines in South America, Canada and South Africa, coal mines in Australia, Colombia and South Africa, as well as interests in operations in Brazil, Suriname, Australia (aluminium) and South Africa (titanium minerals and steel and ferroalloys). In 2001 Billiton Plc merged with the Broken Hill Proprietary Company Limited (BHP) to form BHP Billiton.[5]
hostile bid of 3.4 BHP Billiton shares for each Rio Tinto share was announced on 6 February 2008.[25] The bid was withdrawn on 25 November 2008 due to a global recession.[26] On 14 May 2008, BHP Billiton shares rose to a record high of AU $48.90 after speculation that Chinese mining firm Chinalco was considering purchasing a large stake. BHP representatives refused to comment.[27] On 25 November 2008, Billiton announced that it would drop its $66 billion takeover of rival Rio Tinto Group saying that the "risks to shareholder value" would "increase" to "an unacceptable level" due to the global financial crisis.[28] In January 2010, after BHP Billiton bought Athabasca Potash for $320m, The Economist reported that by 2020, BHP Billiton could produce approximately 15% of the world demand for potash.[29] In August 2010, BHP Billiton made a hostile takeover bid worth $40 billion for the Potash Corporation of Saskatchewan. The bid came after BHP's first bid, made on 17 August, was rejected as being undervalued.[30] This acquisition marked a major strategic move by BHP outside hard commodities and commenced the diversification of its business away from resources with high exposure to carbon price risk (coal, petroleum, iron ore). The takeover bid was opposed by the Government of Saskatchewan under Premier Brad Wall. On 3 November, Canadian Industry Minister Tony Clement announced the preliminary rejection of the deal under the Investment Canada Act, giving BHP Billiton 30 days to refine their deal before a final decision was made.[31] On 14 November 2010, the company announced that it was dropping its offer for Potash Corporation of Saskatchewan.[32] In September 2011, BHP announced it's intentions to move to an owner operated mining business in Western Australia. Mining operations for 3 well established Pilbara sites was operated through contractor Leightons HWE. These contracts, plant and support services were purchased for around $700m.
1 196 Authorized as EMD exchange manufacturer 3 197 Develops first key phone in Korea 3 198 Surpasses 1 million lines of TDX-1A installation in Korea 9 199 Starts commercial service of TDX-10 large-capacity, fully electronic 1 telephone exchange 199 Develops the Worlds First CDMA for Commercial Use 5 199 Provides PCS System to LG Telecom 6 200 Commercializes asynchronous IMT-2000 system 1 200 Demonstrates IMT 2000 service at Korea-Japan World Cup. 2 200 Develops worlds first soft switch and next-generation networking 3 solution with Korea Telecom
After Incorporation
200 Aug Signs definitive agreement to establish joint venture 5 . Nov Establishes LG-Nortel . 200 Apr. Delivers Video Phone to Telecom Italia. 6 Ma Microsoft, LG-Nortel Sign MOU to develop and market WinCE IP y phones Ma SK Telecom launches Worlds first handset-based HSDPA y network with LG-Nortel Jun. KTF launches nationwide ultra-high speed wireless network with LG-Nortel
Aug Launches Aria SOHO, key phone system a small-capacity key. phone system targeting the world SOHO market. 200 Mar Powers SK Telecom next-generation wireless service with 7 . innovative network solution Mar Launches world-first layer 2 security switch . Jun. KT, LG-Nortel and Nortel combine expertise at Mobile WiMAX Service Conformance Verification Center
Sep LG Telecom launches CDMA Rev.A service with LG-Nortel . Oct. Launches new reseller campaign targeting SMB market in Brazil
Launches innovative Unified Communications devices Oct. optimized for use with Microsoft Office Communications Server 2007 Nov Wins the Minister of MIC Award from Korea Internet Award . Nov Wins the Prime Ministers Award from Korea Radio Promotion . Association (RAPA) Dec Achieves over KRW 1 billion in sales . 200 Feb Demonstrates wireless internet based 4G network with LG 8 . Electronics in Mobile World Congress 2008 Mar Launches a toll paying device PassQ . Apr. Apr. Demonstrates worlds first 4G technology with Nortel and LG electronics CEO J.R. Lee wins distinguished service medal from Vietnam government
Jun. Opens LG-Nortel Engineer Training Center Aug acquires Novera Optics, a developer of fiber-optic access . solutions
Sep Signs partnership with Polycom in Unified Communications . business Nov Provides 40G optic solutions to SK Broadband . 200 Signs MOU with LG Telecom to build out CDMA 1X/DO and 4G Jan. 9 network Feb Provides WDM-PON solutions to UNET, Netherland . Ma Signs partnership agreement with Citrix Systems in L4-L7 y switch business Ma Partners with ETRI for global standardization in WDM-PON y technology Jun. Jun. VKX, a LG-Nortel R&D center in Vietnam, wins labor medal from Vietnam government Launches commercial WDM-PON commercial service with Agder Broadband, Norway
Jul. Provides Multimedia phones to Telio in Norway Jul. Develops a worlds first Android embedded multimedia phone Aug Launches a toll paying device PassQ Slim . Aug Signs Partnership with Telamon in USA for WDM-PON business . Sep Provides Key Phone solutions to Telefonica Brazil . Sep Demonstrates WDM-PON solutions in Broadband World Forum . Europe Nov SK Telecom rolls out LG-Nortels Wideband Cellular Gateway . System over an urban area Dec Acquires CMMI (Capability Maturity Model Integration) level 3 . in all R&D area 201 Launches joint venture in USA with Accton group for SMB Jan. 0 market in NA
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When purchasing any type of electronic device, consumers have a tendency to trust brands which have long been in existence. The longer a company has been in operation, the better the brand recognition is. In the case of Sony Ericsson, despite the fact that they are a relatively young company as compared to the mobile phone manufacturer 'giants' - they have enjoyed a constant stream of customers. These loyal clients avidly subscribe to the Sony Ericsson brand of mobile phones whenever a new one is released in the market. A Look Back into the History of Sony Ericsson as a Company But how exactly did the Sony Ericsson company come about? Sony Ericsson is actually a joint venture between Sony and Ericsson which merged in this joint venture which was founded in 2001. The company's head office is located in London and they currently specialize in manufacturing the following products: - Hi-tech accessories - Mobile phones - Mobile music devices - Wireless systems - Wireless voice devices - Wireless data devices When Two Companies Joined Forces Again, Sony Ericsson is a joint venture which was established seven years ago. The two parent companies are Sony Corporation and Ericsson. Sony Corporation is a Japanese consumer electronics company, which is one of the world's most popular brands. On the other hand, Ericsson is a Swedish telecommunications company. Rather than individually manufacturing their own lines of mobile phones, these two companies decided to join forces. When Sony Ericsson was formed in 2001, Sony and Ericsson stopped manufacturing their own mobile phones. Key Dates in the History of Sony Ericsson
To better learn about the history of these two companies, here are some key dates in the history of Sony Ericsson: 1885 - Lars Magnus Ericsson was the name of the man behind the company, and he first mended telegraph equipment in Sweden. It was on this same year that Ericsson started repairing and building their own handsets - which they are still doing up to now. 1958 - The name of Tokyo Telecommunications Engineering Company was officially changed to Sony. 1968 - Following the popularity of Sony as one of the best consumer electronic brands in the world, Sony UK was founded. 1987 - Ericsson produced the first mobile phone for the NMT network. 1992 - Ericsson built more and more mobile phone models to keep up with the consumer demand. 2001 - Sony Ericsson was established. The Sony Ericsson Mobile Phone Manufacturer of Today Over the years, Sony Ericsson has managed to etch a name for itself in the very competitive mobile phone manufacturing industry. For subscribers who are looking for Sony Ericsson mobile phone deals, you do have a lot of options. You can take you pick from the line of mobile phones that they have which includes: - Sony Ericsson Walkman Series - Sony Ericsson Cyber-Shot series - Sony Ericsson UIQ Smartphones - Sony Ericsson Xperia Windows Mobile Operating System Phones Whether you are looking for a good music phone, camera phone or smartphone, there should be Sony Ericsson mobile phone deals which will suit your mobile communication needs to a tee.
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