Continental, one of the leading international automotive suppliers and the world’s fourth largest tyre manufacturer, has acquired 100 pc shareholding in Modi Tyres Company Limited (MTCL), a subsidiary of Modi Rubber Ltd. Further to the announcement in April, Continental confirmed that it has now received the necessary regulatory clearances and has completed the acquisition. The purchase price consideration for 100 pc of the shares of MTCL is approx. 18.5 million Euros (Rs 116.04 crore approximately). Both parties have agreed to keep other commercial details of the transaction confidential.
MTCL has now become a fully owned subsidiary of Continental Corporation and will be renamed as Continental Tyres India Limited. The new entity will focus on local production and distribution of bias and radial truck and bus tires as well as radial passenger car tires for the Indian market.
Commenting on the occasion, Nikolai Setzer, member of Continental’s Executive Board and head of the Passenger and Light Truck Tire (PLT) division said, “The acquisition of MTCL underlines our commitment to the Indian market. It is part of our strategy to invest into local production of both passenger car tyres and truck tyres in growing markets in Asia.” For the commercial vehicle tyre business, for which Setzer will be responsible within Continental as of August 1, 2011 as well, the move is an important signal. “India’s truck tyre market is of outstanding relevance worldwide and exceeds with a size of 18 million tyres per year already the Western and Central European market. Thus, we are confident that our premium technology combined with the new local presence will make Continental a reliable and strategic partner both for the tire replacement business and original equipment manufacturers in India”, Setzer added.
“The highly motivated employees in Modipuram, Partapur and Delhi are looking forward to contributing their profound knowhow of the Indian market as well as the company's local distribution structure to the success of the internationally renowned corporation of Continental in an increasingly competitive market environment,” Alok Modi, former CEO of MTCL, pointed out at the closing of the deal.
Continental Tyres India Ltd will have its registered office in Delhi with manufacturing facilities both in Modipuram and Partapur. Currently, an integration team works jointly with the new employees on achieving an optimal start for Continental Tyres India with the full set of resources now available from Continental.
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