Pegatron, the Taiwanese electronics manufacturing giant, is reportedly in advanced negotiations to sell its sole iPhone production facility in India, situated in Tamil Nadu, to the esteemed Tata Group.

This development, disclosed by Reuters on Monday, April 8, has been further affirmed by sources privy to the matter, asserting that Apple, the tech titan, is supportive of this impending deal.

According to the report, Tata envisions securing a minimum of a 65 per cent stake in a collaborative enterprise designated to manage the Pegatron plant near Chennai, while the remainder of the ownership will be retained by Pegatron, earmarking it for technical assistance.

This strategic alliance will be executed under the aegis of Tata Electronics, a subsidiary of the Tata conglomerate.

The manufacturing facility in question currently hosts around 10,000 employees and is accountable for the annual production of approximately 5 million iPhones.

This potential transaction marks yet another instance of Pegatron's recalibration within its partnership with Apple, following its relinquishment of control over an iPhone manufacturing hub in China to its competitor Luxshare in a landmark $290 million agreement last year.

Pegatron had justified this manoeuvre as a strategic measure to enhance its financial agility and optimize its operational efficacy.

Tata, which already oversees an iPhone assembly plant in Karnataka, inherited from Wistron, and is in the process of constructing another in Hosur, Tamil Nadu, appears poised to expand its collaboration with Pegatron through this prospective joint venture.

Interestingly, Pegatron has been concurrently developing an additional iPhone manufacturing facility at the same Chennai campus, and discussions concerning the deal purportedly encompass Tata's acquisition of this site as well.

The negotiation timeline stipulates a tentative closure within six months, during which all existing Pegatron employees in India are anticipated to transition to the new joint venture entity.

This strategic manoeuvre is expected to fortify Tata's foray into iPhone manufacturing and facilitate Apple's strategic objectives of augmenting its foothold in the burgeoning Indian market.

As of now, no formal declarations have been issued by Pegatron, Tata, or Apple regarding the transaction.

Notably, Apple's iPhone manufacturing partners in India encompass Tata, Pegatron, and Foxconn, reflecting the tech behemoth's concerted efforts to diversify its supply chain and bolster its presence in one of the world's most promising markets.