Apollo 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.
As you may remember, during 2008 Apollo examined several Eastern European sites, including Gyöngyös in Hungary, with the intention of setting up a greenfield facility. Yet in early 2009 the company announced an almost two hundred per cent reduction in capital expenditure plans for the following two years, and thereafter plans for Eastern Europe were put on hold. When Apollo’s intention to purchase the financially burdened Dutch manufacturer Vredestein was announced only two months later, it was assumed the greenfield project further east was a dead issue for the foreseeable future. Yet according to Outlook Business, Sarkar ‘indicates’ Eastern Europe may still be an ideal location for a new facility. “I think we have tested both organic and inorganic routes,” he is quoted as saying. “We are reasonably happy with this model and we will continue with it.”