Titan acquires Russian tyre maker
News from the USA; Titan International Inc., in partnership with One Equity Partners (OEP) and the Russian Direct Investment Fund (RDIF), has closed the acquisition of a majority interest in Voltyre-Prom, a leading producer of agricultural and industrial tyres in Volgograd, Russia, from the principal owner, Cordiant, for approximately $94 million. This sum includes the assumption of debt, subject to various post closing adjustments over a period of three years.
Titan International will act as managing partner for the consortium which combines strong local business knowledge, financial expertise and manufacturing proficiency.
As Titan focuses on building a leading wheel, tyre and undercarriage enterprise across the world, the company says that this transaction offers unique opportunities to both Titan and Voltyre-Prom. The investment will allow Voltyre-Prom to update its current operations and strategically grow the business.
The acquisition complements Titan’s global strategy, expanding its footprint into Russia. Voltyre-Prom held a 43 per cent market share in agricultural tyres and 16 per cent market share in industrial tyres in Russia in 2012. Titan’s experience in these markets will allow the company to add synergies and resources to execute on opportunities for growth.
Titan’s top customers such as Deere, CNH and Agco are expanding into the Russian market, where agriculture is prospering as equipment purchases and mechanisation increases. Voltyre-Prom annual revenue in 2012 was approximately $200 million.
Titan Chairman and CEO, Maurice Taylor adds, “We are excited to be part of aconsortium with RDIF and OEP which allows us to enter into Russia where Voltyre-Prom holds a dominant share in agriculture tyres. As managing partner, we plan to expand our product offering and dealer network.
“The top executives from Voltyre-Prom, led by Olga Shilina, share in our enthusiasm and toured our U.S. facilities last month. This is the beginning of our advancement into Russia and the Commonwealth of Independent States region.” pg