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Bekaert Acquisition Talks in Russia Abandoned

International News

Following several months of negotiations Bekaert has opted to withdraw from talks with Russian firm ZAO Uralkord regarding a possible takeover. The Russian manufacturer, located in the industrial city of Magnitogorsk, produces steel cord products for domestic tyre manufacturers and was viewed as a suitable vehicle through which the Belgian firm could strengthen its position in Russia. As recently as late July Bekaert CEO Bert De Graeve told media that the group was hopeful of closing a deal by the end of the year, adding that about 50 million euros had been offered for the purchase of Uralkord.

Despite this optimism, the deal fell through within three months of De Graeve’s announcement. The reason for this, Bekaert outlined in a statement, is that during “the course of the difficult and protracted negotiations, it became clear that no agreement could be reached with the current shareholders of ZAO Uralkord that would meet Bekaert’s criteria for pursuing its strategy of sustainable profitable growth in Russia.”

15th October 2007/by Tyrepress Editors

Private Firms “Prey For Value Hunters”

The UK’s dwindling number of privately owned tyres, exhausts & batteries firms are looking more and more like potential takeover targets, according to a new report by business analysts Plimsoll Publishing. Latest research shows that 804 of the UK’s top 1000 tyres, exhausts & batteries companies remain in private hands, and their values are increasing faster than those of their corporate competitors. Their exclusivity, niche products and unique services are adding to their attractiveness.

Another more practical factor is also coming into play, according to Plimsoll’s senior analyst, David Pattison. “The increasing age of owners and principals at some of these companies is causing them to consider their choices,” he says. “While many family firms have succession plans in place, an offer for the company at the crucial moment is often listened to sympathetically, as the new generation review their options.”

But the big prize for corporate and private raiders is the hidden potential of family-run companies. Current owners typically strip out 80 per cent of profits as fees. To the value hunter, this is a huge platform on which to build. But for those who are not averse to the idea of a takeover, their past activity may backfire on them.

13th August 2007/by Tyrepress Editors

Former Conti Boss Urban Dies

Former Continental CEO Horst W. Urban passed away on June 21, three weeks after celebrating his 71st birthday. Mr. Urban had been battling the affects of lung cancer, for which he underwent surgery last year.

Together with colleague Helmut Werner, Horst Urban developed proactive strategies to strengthen the tyremaker’s position, including the acquisition of rival brands Semperit and General Tire. During the early 1990s Urban vigorously resisted a takeover bid for Continental launched by Pirelli. Following the successful conclusion of this corporate struggle he tendered his resignation as company CEO in 1991, reportedly due to differences of opinion with supervisory board chairman Dr. Ulrich Weiß. At this time Dr. Weiß also held a position on the board of Deutsche Bank and was, amongst other roles, responsible for the bank’s business in Italy, and was thus considered to possess a more sympathetic view of the Pirelli takeover attempt than Mr. Urban.

26th June 2007/by Tyrepress Editors

Steel Giant Seeks Controlling Stake in Cooper JV Company

Information supplied by a spokesman for leading global steel manufacturer Arcelor Mittal indicates that the company plans to pay US$27 million for a controlling stake in China’s Chengshan Steel Cord Co. This stake, according to a China Business News report of June 20, could be higher than 90 per cent, however its exact size has not been specified, and Chinese government approval must first be granted before any transaction can take place.

The firm at the centre of the takeover plans is located in Rongcheng, Shangdong Province, and is a 75-25 per cent venture between Shandong Chengshan Group Co and the Cooper Tire & Rubber Co. The company produces steel cord and bead wire for use in tyre reinforcement, and has an annual output capacity of more than 60,000 tons. Chengshan Steel Cord achieved sales of 375 million yuan (£24.6 million) in 2006, up 51.5 per cent from a year earlier.

Cooper Tire has not commented on this proposed deal, but if it takes place they may be required to pull out of the venture they helped establish.

25th June 2007/by Tyrepress Editors

Plimsoll: Rising Interest Rates Have “Silver Lining”

Rising interest rates are bad news for homeowners – but they could be a lifesaver for some businesses, according to commercial analysts at Plimsoll Publishing. “Our research shows more than a quarter of UK Tyres, Exhausts & Batteries companies are in more debt than they have been at any time in their history, “ said David Pattison, senior analyst at Plimsoll. “Rising rates are a useful wake-up call. Many of the companies in question have been enticed by low interest rates and the lure of easy debt secured on rapidly rising property prices, and so have been able to cover up flaws in their business strategies – effectively buying time. There is just enough time left for these firms to look seriously at their balance sheets and change direction.”

If companies reduce their level of debt and streamline their business models, they may have a future, according to Plimsoll. Plimsoll, which has conducted independent assessments of private and publicly quoted companies for the past 20 years, has an established track record of spotting the warning signs for businesses. Nearly nine out of 10 failed companies in the UK had earned a “danger” or “caution” rating from Plimsoll in the two years before their demise.

19th June 2007/by Tyrepress Editors

European Commission Approves VB Autobatterie Acquisition

The European Commission has reported its approval of German company VB Autobatterie GmbH’s proposed acquisition of Italy’s FIAMM group’s automotive starter battery business, subject to the German company allaying competitor’s concerns about the impact such a deal may have.

These concerns are related to the FIAMM group’s business in Italy, Austria, the Czech Republic and Slovakia, as the company holds a strong market position there. A question mark hangs over the impact the planned transaction will have in these markets. VB Autobatterie has offered to divest some of its manufacturing capacity and some key FIAMM brands relevant to the replacement part markets in these countries.

The Commission’s initial market investigation in December stated that the proposed acquisition would raise ‘serious competition concerns’, but its latest position is that, subject to a number of conditions, the takeover would not have any significant hindering effect upon competition within European markets.

11th May 2007/by Tyrepress Editors

Report: 85 UK Tyre Companies Are Takeover Targets

At least 85 UK tyres, exhausts & batteries firms are prime targets for a takeover and another 113 could be sold off by their parent companies, according to a new report by independent business analysts Plimsoll Publishing. At the other end of the scale are 27 major companies that are expanding rapidly, largely through acquisitions, and 76 “predators” who are using the misfortune of others to clean up in the market.

Plimsoll’s senior analyst, David Pattison, said: “The 85 takeover targets we have identified generally have a similar profile – they are privately owned, are in financial difficulty and have owners who are approaching retirement. Any firm in this position should be listening to the warning bells, because its potential selling price will be in the bargain basement. The other 113 distressed companies are operating as divisions of larger parents. I’m fairly certain that conversations are going on behind closed doors about their future.”

16th April 2007/by Tyrepress Editors

Bandag Shareholders Approve Sale

Bandag Inc. held their final shareholders’ meeting on April 3, at which shareholders approved the sale of the retreader to Bridgestone Americas Holding, subsidiary of the Japanese tyre major, for US$1.05 billion. Bandag will become part of the US Bridgestone operation once the deal closes, which is expected to take place during the second quarter. Bandag spokesman Bill Block said the companies are awaiting regulatory approval in Europe and Canada before the deal is completely finalised, but anticipate no complications.

4th April 2007/by Tyrepress Editors

New Tool Takes Gamble out Company Acquisitions

A unique new commercial tool is set to transform the way companies go about acquiring other businesses, according to its developers. VIBE, which has been devised by Plimsoll Publishing, draws on a database of information covering virtually every company in Britain and Northern Ireland. It shows at a glance if a company is ripe for takeover – and why.

2nd March 2007/by Tyrepress Editors

Conti Ready to Flash the Cash

German tyre and automotive systems major Continental AG has said they would prefer to deal in cash during the potential takeover of Siemens AG’s VDO unit or Goodyear Tire and Rubber Co’s engineered products division, according to the company’s chief financial officer Allan Hippe.

27th February 2007/by Tyrepress Editors

Conti Amtel Deal “Has Died”

It appears Continental AG will not takeover Russian-Dutch tyre manufacturer Amtel-Vredestein after all. “The deal has died for now,” reported the Frankfurter Allgemeine newspaper, quoting a Continental supervisory board member. The source reported that the negotiations did not even reach fulfilment of the Due Diligence process as certain questions were not sufficiently answered. No details of what these might have been were published. The Continental press office has not made an official comment on the subject. The news comes after months of speculation following Russian news reports that Amtel boss, Alexei Gurin approached Continental for negotiations. Then reports suggested the deal could have been completed by March 2007.

26th January 2007/by Tyrepress Editors

Axa Cuts its Conti Stake to Under 10 per cent

French insurance giant Axa has cut its voting stake in Continental, the German maker of tyres and auto parts, to less than 10 per cent, according to the automotive. As of 4 January, Axa’s voting stake in Continental stood at 9.52 per cent, the auto parts specialist said in a mandatory legal filing published in the German press. Previously, Axa had held a share of 10.05 per cent in Continental’s voting capital.

17th January 2007/by Tyrepress Editors

Investor: Conti Takeover Project Dead

An investor involved in takeover negotiations with Continental earlier this year (Philipp Schoeller of General Capital Group) has denied he has any interest in pursuing the plans again. “The project is dead,” GCG co-founder Philipp Schoeller told Reuters, adding: “a resurrection of the project lacks any practical basis”. Continental’s share price rose 2.56 per cent following an earlier WirtschaftsWoche report that suggested Schoeller might again try for a takeover. Schoeller called his remarks to the German business magazine “purely hypothetical”.

12th December 2006/by Tyrepress Editors

Continental Welcomes “Strategic Stake”

A little more than two months after ending takeover negotiations with an officially unnamed private equity company, Continental AG chief executive, Manfred Wennemer has stated that he is not opposed to a strategic investor acquiring a stake in the company. In an interview with the German Automobilwoche trade magazine Wennemer, also reiterated that acquisitions of other companies remain a high priority for Continental. These remarks follow reports that Continental is holding takeover talks with both Matador Rubber and Amtel-Vredestein. The earlier private equity takeover bid was pitched to Conti by Bain Capital LLC and offered more than Continental’s 13 billion euro market, according to the Financial Times.

22nd November 2006/by Tyrepress Editors

SEBI Directs Ruias to Make Open Offer

The Securities and Exchange Board of India (SEBI) has directed the Pawan Ruia group, promoters of Dunlop and Falcon Tyres, to make open offers for both the, reports Business Standard. The regulator has also directed the company to pay interest of 10 per cent to the shareholders as penalty from February 2006, over and above the offer price for violation of the takeover code by the promoters.

14th November 2006/by Tyrepress Editors