KUALA LUMPUR (Aug 12): APM Automotive Holdings Bhd is teaming up with a Thai firm to manufacture, assemble and sell automotive seats in Vietnam for original equipment manufacturers (OEM).

APM Automotive told Bursa Malaysia that its indirect unit, APM Automotive IndoChina Ltd, has inked a joint venture agreement with TACHI-S (Thailand) Co Ltd, a unit of TACHI-S Co Ltd, today, for the above purpose.

According to the automotive parts and components maker, a new joint venture company (JV Co) will be incorporated in Vietnam under the proposed name 'APM TACHI-S Seating Systems Vietnam Co Ltd', with an investment capital and charter capital of US$2.5 million.

APM Automotive will contribute 49% or US$1.23 million to the JV Co, while TACHI-S will contribute 51% or US$1.275 million.

Besides the business of developing, manufacturing, assembling and selling automotive seats in Vietnam for OEM, the JV Co may also undertake other businesses that are deemed fit and beneficial to both JV parties.

TACHI-S is a limited liability company incorporated in Thailand on Sept 14, 2011 to supervise the operations of the TACHI-S Group in India and the Asean area. It is a wholly-owned subsidiary of TACHI-S Co Ltd, a Japan-based global automotive seat system designer and manufacturer.

The filing also stated TACHI-S is a JV partner with one of APM Automotive's subsidiaries in Malaysia.

APM Automotive said the new tie-up is in line with its plan to increase its market share in markets outside Malaysia.

"The JV will enable both parties to leverage on each other’s knowledge and experience to bring greater synergy in their expertise and know-how in the design, development, manufacture, assembly and sales of automotive seats," it added.

It added that the automotive industry is poised to grow in the up-coming emerging markets in the Asean region, and so the timing of the JV is appropriate to capture the opportunities to expand its current seat business overseas.

It expects the JV to contribute positively to its future growth.

Shares in APM Automotive was unchanged at RM3.51 at market close today, valuing it at RM684.38 million.