Dunlop Invests £27 million on Factory Expansion
Dunlop Nigeria Plc, has invested an estimated sum of 6.5 billion naira (roughly £27 million) on radialising its plant technology with a view to further boosting the production of tyres for heavy duty vehicles.
According to company, the Super Steel Radial Plant will be commissioned by Nigerian President, Olusegun Obasanjo, and will be capable of producing 300,000 heavy duty tyres annually. Furthermore, the expansion is expected to create 200 additional jobs.
The plant, which has already commenced production at the company’s Lagos headquarters, will cater for demands in the local Nigerian market as well as for exports to neighbouring West and other African markets.
Various local news sources have reported that managing director, My Yinusa Mohamed, secured finance for the project through a consortium of banks. Roughly half of the total capitabal is reported to have been raised in form of loans from the banks which he highlighted to include Union Bank Plc, UBA, Afribank, Intercontinental Bank Plc, Chartered Bank, Citizens Bank and FBN Merchant Bank. The company funded the remaining 50 per cent itself.
Mr Mohamed explained that the company intends to convert the overall fund into long term funding through the capital market or a combination of other long term investment instruments. “The project has reached the stage where we are now evaluating the products. We believe this is an opportunity for Dunlop to continue to invest in the economic development of this country. We believe it is an opportunity to create more jobs for our teeming population,” Mr Mohamed told local journalists.
In addition, the Dunlop boss revealed the company’s plans to boost its investments with a view to increasing its basic share in Palmol Rubber Plantation Company situated in Calabar. So far the company has secured an addition of 10,000 hectares of land from Cross River state government to expand on natural rubber production in the company, he added.
Palmol which was formerly owned by Unilever is currently a subsidiary of Dunlop Nigeria Plc with an equity investment of over 60 per cent and is managed by the Dunlop management. The plantation, which presently employs between three to four thousand workers occupies many hectares of land also Cross River, Edo as well as in Delta state.
Dunlop commenced operations in Nigeria in 1961 with construction of its first factory in Lagos in 1963 and has since been involved in the manufacture of truck tyre and some car tyres.