Diversified U.S. manufacturer SPX Corp and Indian engineering firm Thermax Ltd will jointly make air pollution control systems in India, in a venture that could bring in annual revenues of up to $100 million in five to 10 years.

Shares of Thermax extended gains to as much as 3.1 percent on the announcement, before paring its gains to close up 1.2 percent in a Mumbai market that rose 0.5 percent.

The joint venture will provide air pollution control systems for power plants above 300 megawatts and energy efficiency equipment, Thermax said in a statement.

Thermax will hold 51 percent and SPX the rest in the venture, which will have an initial investment of 250 million rupees ($5 million), M. S. Unnikrishnan, managing director of Thermax, said at a media conference.

The firm will offer air pollution control equipment, which costs about $15-20 million, and has the potential to achieve annual revenue of $50-100 million in five to 10 years, said Drew Ladau, SPX's president of thermal equipment and services.

The venture has lined up supply-chain partners, but may initially need to source some products from SPX's overseas facilities, Unnikrishnan said.

Pune-based Thermax makes boilers, offers water and waste solutions and installs captive power projects. SPX, headquartered at Charlotte, North Carolina, offers specialized engineering solutions.

Thermax already has a technology-licensing agreement with SPX's German unit, Balcke-Durr, for air pollution control equipment called electrostatic precipitators for up to 300 megawatts.

(Editing by John Mair and Muralikumar Anantharaman)