France-based Schneider Electric, one of the world's leading providers of power distribution and industrial control solutions, signed a framework agreement with Delixi Group for strategic co-operation in a new joint venture in Wenzhou, East China's Zhejiang Province.
 　　
Liu Changsheng, vice-president of the China Quality Certification Centre said the co-operation so far is the biggest of its kind by scale and investment in China's power industry. According to Jean-Pascal Tricoire, chairman and chief executive officer of Schneider Electric global, China is his company's third largest market. "I believe in two years China will be our second biggest market, surpassing France, and only behind the United States," he said.

The China market now contributes 8 per cent of the total global turnover for Schneider Electric. The new venture, named Delixi Electric Ltd, which will be incorporated in Wenzhou, is dedicated to the manufacturing, marketing and distribution of low voltage products. Operations will begin once certain conditions and regulatory approvals are met.

The products will be manufactured and sold under the Delixi brand and distributed by its network of 1,500 dealerships around the nation. Both sides, however, declined to disclose investment details. "We will reveal the figures after the registration of the facility," said Hu Chengzhong, president of Delixi Group.

The joint venture is expected to achieve annual revenue of about 2.26 billion yuan (US$282.5 million) on a full year basis, with a profit margin (after tax) of approximately 10 per cent. "This joint venture will benefit from Schneider Electric's leading technical and management support and from Delixi's brand image and local roots.

"The complementary relationship between a domestic and a world-renowned enterprise will create new opportunities, contribute to the development of the Delixi brand, and propel our internationalization efforts further," Hu said.

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