OTR Tyres buys Titan International’s Australian wheel business

Titan International, Inc. has entered into a definitive agreement to sell its Australian wheel business to OTR Tyres, a Western Australia-based tyre, wheel and service provider. It anticipates closing the deal on 31 March 2022.

Explaining Titan’s decision to sell the operation, Paul Reitz says the company’s management and board of directors “believe the business will be best suited in the hands of a local market leader, which can continue to develop and grow the business going forward.” The president and chief executive officer notes that Titan International “took a number of steps to turn around the financial performance in this business” in recent years, including “exiting from the tyre servicing business and less profitable products.” Reitz adds that “our Australian management team has consistently made decisions to put the business on a good path.

“We will continue to operate our undercarriage business in Australia, and the sale of this business will have minimal impact on sales of tyres manufactured by Titan,” Reitz continues. “We thank all of our dedicated employees in this business for their contributions to Titan’s success and we wish them the very best in their future with OTR Tyres.”

The sale includes gross proceeds and cash to be repatriated of approximately AU$23 million (£13.2 million), and the assumption of all liabilities, including employee and lease obligations. The purchase price is subject to customary post-closing review and potential adjustments related to target working capital, along with the release of certain restricted cash related to lease guarantees. The proceeds related to the transaction are expected to be primarily utilised to pay down debt and pay advisory fees.