Creditors’ Preliminary Report Confirms Kumho Tire's Business Potential
Creditors have reportedly named PricewaterhouseCoopers Korea and Deloitte Anjin LLC as the firms carrying out due diligence on Kumho Tire and Kumho Industrial. The accounting firms may take about two months two deliver reports, however creditors have decided to conclude the process earlier than previously planned to speed up the normalisation of the two Kumho Asiana business units.
Continue ReadingWTO to Rule on US Tyre Tariffs
The World Trade Organisation will make a ruling on the complaint lodged by China last September over the US tariffs implemented on Chinese manufactured consumer tyres. A WTO spokesperson has confirmed a panel of experts who will decide upon the validity of China’s claim has already been established.
Continue ReadingGoodyear Assessing Impact of Venezuelan Currency Devaluation
On January 8, the Venezuelan government announced the devaluation of its currency, the bolivar fuerte, and the establishment of a two-tier exchange structure. This has seen the official exchange rate against the US dollar slide from 2.15 bolivar fuerte per dollar to 4.30, except in the case of essential goods, for which the rate is 2.60. This significant currency change has impacted tyre makers active in the South American country; Goodyear Tire & Rubber reports it expects a first-quarter 2010 charge of about $150 million (62 cents a share) in connection with the devaluation.
Continue ReadingMichelin Announces July End to Japanese Factory’s Tyre Production
Plans to cease tyre production at Michelin’s factory in Ota, Japan were announced on January 15. Upon giving word of the July 2010 end of passenger car and light truck tyres at the Gunma Prefecture site, Michelin explained that, despite taking measures to improve productivity, reduce production costs and, since 2007, refocus on the production of ‘complex products’, production costs at the Ota plant have remained around twice as high as those of other plants serving that tyre segment.
Continue ReadingVredestein and Carlsson Announce Cooperation
Details of a cooperative partnership between Vredestein and vehicle manufacturer Carlsson were announced on January 11. Upon announcing the commencement of the collaboration, Vredestein Germany managing director Michael Lutz stated “in Carlsson we now have a strong partner in the field of premium styling. Carlsson is one of the best car tuning manufacturers anywhere in the world. Above all, the Carlsson name stands for elegant and exceptional design, high-torque engines and innovative German quality engineering for Mercedes cars.”
Continue ReadingConti Completes Bookbuilding of New Shares
Continental reports that the following news is not intended for direct or indirect release, publication or distribution into the USA, Canada, Australia or Japan, so T&A invites subscribers outside of these regions to read further.
Continue ReadingPirelli enters ECPI Sustainability Index
Pirelli & C. SpA reports that in December the company’s credentials as a socially responsible firm for investors were confirmed by its addition to the ECPI Ethical Index EMU, the ethical finance index produced by Italian investment bank E. Capital Partners (ECPI), a leader in the rating of socially responsible investments.
Continue ReadingApollo Still Contemplating Eastern Europe Greenfield Plant?
Although Apollo Tyres, as CFO Sunam Sarkar told Indian publication Outlook Business in December, decided to pass up on the acquisition of Mexico’s Tornel, it is by no means ready to stop its global growth. The magazine reports that plans for a presence in Eastern Europe are still on the agenda.
Continue ReadingUpdate – Details emerging on Impact of Kumho Workout
Even as the debt-laden Kumho Asiana Group continues with its overall corporate restructuring plan, more details are starting to emerge about the fate of its Kumho Tire Co. unit. Both Kumho Tire and sister unit Kumho Industrial have entered a debt “work-out” program with creditors, and the “majority” of those creditors have agreed to freeze debt repayments for three months to allow the companies “time to carry out a planned restructuring programme.”
Continue ReadingKumho Tire Debt Plan Approved
The Business Financial Newswire reports that Kumho Tire’s creditors have frozen the company’s debt repayment between December 30 and April 5 and have given their approval to a plan to place the company under a debt-workout programme. Under the workout programme, the due diligence process on the company before a final restructuring programme is agreed upon is expected to take about six-to-eight weeks.
Continue ReadingBillion Euro Rights Issue Another Refinancing ‘Milestone’ for Conti
The issuance of 31 million new Continental AG shares, valued at 35 euros apiece, is anticipated to increase the company’s capital by approximately 18 per cent. This rights issue, approved by Conti’s Supervisory Board on the evening of January 6, has been described by Continental as “another significant milestone” in its plan to improve its capital and financing structure, and the capital raised along with the 2.5 billion euro loan announced last month will be used to repay the company’s 3.5 billion euro Tranche B debt, which is due in August.
Continue ReadingAlliance Considering White Collar Redundancies
In the last year more than two hundred Israel based Alliance Tire staff have been laid off, and on December 24 Israeli financial newspaper Globes reported the possibility that the same fate may now await “dozens” of white collar employees and production support staff. It would appear those employees not covered by the collective agreement signed between Alliance and Israel’s labour federation in 2008 are most likely to bear the brunt of any redundancies – the agreement forbids Alliance from firing any staff covered by the deal without first going through a pre-agreed process.
Continue ReadingS&P Lowers Titan International Outlook
On December 22 Standard & Poor’s lowered its outlook on Titan International, citing the tyre maker’s higher debt levels. The outlook was lowered to “negative” from “stable.” All of the company’s ratings, including its junk-grade “B+” corporate credit rating, were affirmed.
Continue ReadingPirelli to Establish Saudi JV?
Pirelli is considering setting up a joint venture tyre manufacturing facility in Saudi Arabia. UAE based newspaper Gulf News has reported on the tyre maker’s desire to capitalise on the abundance of raw materials available in the Persian Gulf city of Jubail. A Pirelli delegation visited the city in December and held discussions with officials from the Royal Commission of Jubail and Yanbu.
Continue ReadingPirelli Negotiates Financing to Increase Slatina Plant Capacity
In late December Pirelli signed a 50 million euro financing agreement with the European Investment Bank (EIB) that will provide the funds to increase tyre and light commercial vehicle tyre production capacity and Pirelli’s facility in Slatina, Romania. This sum will be used within the context of the 250 million euro investment the Pirelli Group previously earmarked for its operations in Romania in the three-year period between 2009 and 2011.
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