After closing down for five years, the Surajpur-based Daewoo Motors' manufacturing facility is expected to be revived as a component and engine making unit, and will also form a support base for new car models in the domestic market.
B V R Subbu, former president of Hyundai and one of the co-promoters of Crosslinks, which bought the Daewoo facility after months of bidding said: "Possibly in another seven-eight months, we would be in a position to utilise the Surajpur facility for making automotive components and engines primarily for exports. Later, we would cater to the domestic market also, as and when demand for these components picks up."
The Surajpur facility is capable of manufacturing 800,000 units (Matiz, Cielo and Nexia) of different segment and Subbu, after acquiring the company for Rs 765 crore (Rs 7.65 billion), could also utilise it for his own car plans.
"We are yet to determine the shape of the facility and we would like to utilise it for any possible manufacturing of cars and other vehicles in future. After the initial restructuring of the plant all the other options would be looked into," Subbu said.
The Crosslinks buyout offer comprises 35 per cent cash, 30 per cent equity and the rest in debt. Analyst said the idle assets of Daewoo India plant at Surajpur would be turned around after the buyout.
Arvind Jain of Religare Securities said: "The facility is expected to be part of the long-term plan of Crosslinks. Subbu had already made public his plans to introduce compact car in India. The Surajpur facility could be a major source for the northern market with logistics fully placed. Its other facility is expected to come up with the Hyderabad-based Lokesh Machines."