The leading Indian tyre manufactures JK Tyre has announced that it had completed the acquisition of tyre, tube and flap maker Cavendish Industries at an enterprise value of Rs.2,200 crore. It is a unit of Kesoram Industries Ltd and Kesoram Industries is a B.K. Birla Group company.
The Cavendish industries is located in Laksar near to Haridwar in Uttarakhand. After this acquisition The JK Tyre fold and raises its plants count to 12 to 9 in India and 3 in Mexico. The deal will add a capacity to produce 10 million tyres a year. The agreement will also enable JK’s entry into the fast-growing two-wheeler and three-wheeler tyre market and will also boost its capacity to produce truck and bus radials.
The JK Tyre will fund the deal through a mix of internal accruals and debt raised by JK Group associates, such as Bengal & Assam Co. Ltd (the holding company) and Valiant Pacific LLC, a trading firm. JK Tyre will hold a 64 % stake in Cavendish, while the rest will be held by Bengal & Assam and Valiant.
After the acquisition, JK’s total manufacturing capacity in India will increase to 26 million units a year. It will reach annual revenue of 10000 crore rupees in the domestic market. Currently in over 100 countries, JK Tyre has also shown interest in cement, paper, oil seals, auto components, defence electronic systems and others.
Extra Info :
JK Tyre & Industries Ltd headquarter : New Delhi, India
It is a part of J. K. Organisation group of Companies.
In 2008, JK Tyre has acquired the Mexican tyre major ‘Tornel’
So lets discuss some questions related to this article which can be asked in the upcoming exams :
1. Name the tyre manufacturing company, who has acquired the Cavendish industries for Rs. 2200 crore ?
2. Cavendish Industries is the unit of which company ?
3. Where the Cavendish Industries is located ?
Courtesy : Times Of India