Sibur Russian Tyres seeks foreign partner
By David Shaw, ERJ staff
Since gaining financial independence from its petrochemical parent in 2006, Sibur Russian Tyres (SRT) has put in place an ambitious restructuring plan. The plan involves a number of steps including the closure of out-dated manufacturing operations and replacing them with new manufacturing facilities to meet the needs of the market. A key element in the strategy is to form a joint venture with a large international tyre company to make high quality passenger car tyres.
According to Igor Karavaev, member of the main board at SRT, the company has annual sales of around $800 million, but debts of only $100 million, so it can easily raise up to $500 million in cash through debts before it has to consider issuing shares through an IPO. In the year just ended, the company had budgeted for a small loss, but instead, said Karavaev, it will make a small profit.
The company is therefore restructuring the product portfolio at each of its four tyre factories and is also investing at its other facilities, which include Russia's largest maker of industrial hose - Rezinotekhnika, based in Saransk, south of Moscow - and Sibur Volzhsky, a tyre cord facility in Volzhsky, in Russia's deep south, close to the border with Tartarstan.
Apart from these, SRT owns and operates Yaroslavl tyre plant, which makes all-steel truck tyres, light truck tyres and aircraft tyres. The Omsk tyre factory makes truck tyres, agricultural tyres, bus and trolleybus tyres and various kinds of non-tyre technical rubber goods. SRT also owns a 50 percent stake in the Matador-Omsk tyre factory, which specialises in passenger car tyres. The Volzhsky-prom plant makes agricultural, forestry and industrial OTR tyres, while the Uralshina tyre factory makes passenger car tyres, two-wheeler tyres and industrial tyres.
Karavaev said that SRT believes it cannot compete in the car tyre market against the imports and the transplant tyre factories, so it wants to form a venture with a foreign tyre maker, in which SRT owns a minority stake, and yields full control to the partner. The model for this is the Matador-Omsk joint venture, in which each partner takes 50 percent of the factory output, he said. Thus, SRT would aim to take a minority share of the output from the joint venture facility, in order to boost its product portfolio with premium quality tyres.
This article is only available to subscribers - subscribe today
Subscribe for unlimited access. A subscription to European Rubber Journal includes:
- Every issue of European Rubber Journal (6 issues) including Special Reports & Maps.
- Unlimited access to ERJ articles online
- Daily email newsletter – the latest news direct to your inbox
- Access to the ERJ online archive