Goodyear Tyre & Rubber has bought out RPG group company Ceat from their 50-50 joint venture, South Asia Tyres Ltd. Goodyear and Ceat met here yesterday to agree to an in-principle restructuring of their respective holdings in South Asia Tyres.
Ceat will continue to source radial passenger, earthmover and two- and three-wheeler tyres from South Asia Tyres till it can produce passenger radials at its own facilities. South Asia Tyres plant at Aurangabad began commercial production in 1996.
Ceat is planning to upgrade its existing Nashik plant, where it used to produce radial tyres with Yokohama technology. However, it is not clear whether Ceat will continue to use the same technology or scout for new technology.
According to a South Asia Tyres statement, Goodyear will take necessary approvals from the FIPB and RBI in due course. The deal is expected to be completed in the third quarter of 1998.
Ceat vice-chairman Harsh Goenka said, This move enables us to focus on our respective priorities. Ceat wants to be a significant player in radial tyres and remain dominant in large bias ply truck tyres, both here and abroad. This move is in line with our strategy of controlling our destiny in core businesses. Goodyear chairman Sam Gibara said, The partnership has been mutually beneficial... but this initiative gives us the opportunity to increase our participation in the growing Indian economy and to better serve our auto manufacturing customers in India.
