JK Tyre & Industries complete acquisition of Cavendish Industries Ltd.
JK Tyre & Industries has completed the acquisition of Cavendish Industries Ltd (CIL), which houses three tyre business undertakings of BK Birla Tyres at a value of ₹2,200 crore. With this, the company has also entered the two/three wheeler tyres market with its plans to launch the first two-wheeler tyre by end of this month. With this acquisition, JK Tyre becomes a 12-tyre plants company with nine plants in India and three in Mexico, it said.
The acquisition of the BK Birla group units has been funded by a combination of internal accruals of ₹700 crore and debt of ₹1,400 crore, it said. JK Tyre would add an additional capacity of one-crore tyres per annum from now, with the total production capacity of 3.47 crore tyres per year (including Mexico plants). The company will manufacture 60-lakh two/ three-wheeler tyres, 12-lakh truck/ bus radials and the rest of all kinds of tyres from the new plants at Haridwar.
With this acquisition, JK Tyre will have additional capacity of truck & bus radials, an important & high growth segment, where it is already the market leader, he said adding that riding on this acquisition, the company eyes a turnover of ₹10,000 crore from the domestic operations in the current fiscal.