The Indian arm of the $17-billion GE Healthcare is bringing all of its remaining stand-alone businesses and manufacturing units under the umbrella of its 19-year-old joint venture with Wipro Ltd. “The consolidation would lead to more effective management and resource utilisation and help accelerate growth for GE Healthcare through the existing JVs large distribution network,” GE’s global chief executive officer Jeffrey Immelt said.

The consolidation under the joint venture implies that Wipro GE Healthcare, which currently distributes around 85 per cent of GE Healthcare’s products and solutions in the country would now be the sole distributor and exclusive vehicle for GE Healthcare’s activities in India. It would also mean that the three units — GE Healthcare’s Life Sciences, GE Healthcare Medical Diagnostics and GE Healthcare Medical Systems (manufactures X ray products and certain other diagnostic imaging products and accessories for export to GE Healthcare worldwide) — would now be merged with the existing joint venture between GE Healthcare and Wipro. The 1,200 employee from these three entities would now become part of the expanded joint venture taking its total employee strength to 2,000. The holding ratio in which GE holds 51 per cent and Wipro 49 per cent would not change in the restructuring process.

“Financial implications of the deal would be very small, the main rationale of this is to simplify the company structure so that we could make our services more cost effective,” Immelt said without divulging the figures.

This restructuring is part of GE’s larger global agenda of converting India into a significant sourcing base and fits well in the paradigm shift of reverse innovation that its global head Immelt has been advocating. GE plans to increase manufacturing of healthcare products in India for both the domestic and export markets. Currently, about 25 per cent of the healthcare products the company sells in India are manufactured within the country.

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