Joint venture focuses on manufacturing missile guidance kits domestically

State-owned defense major Bharat Electronics Limited (BEL) has officially given the green light to a strategic partnership with French aerospace giant Safran. In a significant move to boost domestic defense production, the BEL board approved a Joint Venture Agreement (JVA) with Safran Electronics and Defence (SED) to collaborate on the advanced HAMMER weapon system.

According to filings made with the stock exchange, the decision was finalized during a board meeting held on Sunday. However, the actual operations will commence only after receiving necessary administrative and regulatory clearances from authorities in both India and France.

Building a Center of Excellence

The two companies plan to incorporate a private limited entity under the Companies Act, 2013. While the registered office is expected to be in Pune, the partners may mutually decide on an alternative location. BEL stated that this new entity will serve as a "Center of Excellence," acting as a key technology partner for India's armed forces.

The primary focus of this collaboration is the manufacturing, supply, and maintenance of Guidance Kits (GK) for the highly capable HAMMER weapon system. These systems are critical for modern warfare and will primarily serve the Indian Air Force and the Indian Navy. The agreement also leaves room to supply other domestic users if both partners agree.

Structure of the Joint Venture

The partnership is a true equal split, with both BEL and Safran holding a 50 percent equity share. The new company will launch with an initial authorized share capital of Rs 1 lakh, divided into 1,000 equity shares. Depending on future business needs, this capital can be expanded up to Rs 10 crore.

Governance will be shared equally as well. The board will feature four directors—two nominated by BEL and two by Safran. While the nominees will appoint a Chairman, that role will not carry a casting vote, ensuring decisions remain collaborative.

This venture marks another step in strengthening India-France defense ties, ensuring that critical maintenance and manufacturing for high-tech weaponry happen within India's borders.

With Agency Inputs, Image Source: Newsd Defence