S8 Capital might acquire Continental’s Russian assets

Drawing upon information from two anonymous sources, Russian newspaper Kommersant has named Moscow-based holding company S8 Capital as a potential purchaser of Continental’s assets in Russia, including its tyre plant in Kaluga. Kommersant shares that S8 Capital, owned by entrepreneur Armen Sargsyan, has already acquired a lift manufacturing facility in St. Petersburg from Otis Worldwide Corporation.

Continental has neither confirmed nor denied the above information, refraining from commenting on the buyer and terms of the deal when approached by Kommersant. “The company’s representative offices, in particular Continental Tires Rus LLC and Continental Kaluga LLC, continue to work as usual, fulfilling obligations to customers, employees and partners in full,” the company said. S8 Capital did not reply to the newspaper’s questions at all.

Kommersant also notes that Armen Sargysyan has “appeared in the media” as a partner of controversial businessman Alexander Varshavsky, an owner of Avilon Automotive Group. Earlier in the month Varshavsky was named as the purchaser of Volkswagen’s assets in Russia, however the status of this transaction is unclear now that a Russian court has frozen Volkswagen’s local assets due to a legal issue with domestic car maker Gaz International.

Continental tyres still sold in Russia

We don’t know which products Continental would allow an S8 Capital-owned tyre business to sell, but on 23 March Russian motoring publication Dvizhka (the Engine) shared comments from Continental Tires Rus that a “wide range” of Kaluga-made Continental, Gislaved and Matador tyres will be available on the Russian market for the summer 2023 season. A representative from the operation’s media department particularly directed Dvizhka’s attention to the Matador range, naming tyre lines such as the MP47 Hectorra 3, MP82 Conquerra 2, MP72 Izzarda A/T as well as light commercial vehicle models including the MPS330 Maxilla 2 and MPS125 Variant. Dvizhka added that the current Continental line-up for Russia includes the ContiPremiumContact 5, ContiCrossContact LX2, ContiCrossContact LX Sport and the CrossContact ATR.

The Continental Tires Rus media representative told Dvizhk that the company’s operations in Russia – in particular Continental Tires Rus LLC and Continental Kaluga LLC – currently continue to operate as usual and “fulfil their obligations to customers, employees and partners in full.”

The Continental plant in Kaluga began producing tyres in 2013 and currently has the capacity to produce 4 million tyres annually, with the potential for expansion to 16 million tyres a year. In addition to tyres, Continental’s business in the Russian Federation includes Continental Automotive Systems and Contitech.