Johnson Matthey's Catalytic Systems Division, which will own 70% of the equity of the joint venture, is the world's largest supplier of autocatalysts with leading edge technologies for both gasoline and diesel engined vehicles.

Magneti Marelli SpA is a major supplier to the automotive industry and is already well established in the Mercosur free trade region of South America. Its activities include all aspects of engine management, control and emission systems.

As soon as appropriate approvals are obtained the new company, Johnson Matthey Argentina SA, will construct a facility in the Buenos Aires region with a capacity of 1.5 million pieces per annum at an approximate cost of £5 million. From this base the joint venture will supply catalysts to the Argentinian and Brazilian car markets where vehicle production is forecast to grow by 40% to 2.5m by the year 2000. Legislation will ensure rapid growth in catalyst fitment from 1997 onward.

Commenting on the agreement, Ing Domenico Bordone, President and CEO of Magneti Marelli SpA, said "Meeting ever more demanding emissions standards will require a co-ordinated approach in the design of a car's emission system. Magneti Marelli, with its expertise in the areas of fuel injection, engine management and exhaust systems, has found an ideal partner in Johnson Matthey with its world leading catalyst technology."