ERJ staff report (DS)
Singapore -- Japan's 2nd largest tyre maker, Sumitomo Rubber
Industries, Ltd. (â€œSRIâ€), will purchase a 1.8 percent stake in South East Asia's largest independent
tyre and wheel distributor, Stamford Tyres Corporation Limited . Subject to the approval from the Singapore Stock Exchange, Stamford Tyres will issue 4.3 million new shares to SRI at a price of $0.35 per share.
The net proceeds from the placement, after deducting estimated expenses of $0.1 million, is
approximately S$1.4 million. The net proceeds will be used to fund the Group's working
capital needs in South Africa.
Wee Kok Wah, President & CEO of Stamford Tyressaid â€œOver the years, Sumitomo Rubber Industries, has been encouraged by our growth
and our initiatives to promote its Falken brand tyres in Asia. As we embark on our
expansion plan in South Africa, we are delighted to have the support from Sumitomo
Rubber Industries and would like to welcome them as one of our valued shareholders.â€
Yasutaka Ii, Executive Officer of Sumitomo Rubber Industries, Ltd.
and President of SRI Tire Trading Ltd said, "â€œWe have a long-term relationship with Stamford Tyres in the Asian Market and have
requested that they promote our Falken brand tyres in South Africa last year. We view
Stamford Tyres as a key partner to the growth of our Falken brand in South Africa and
believe that this 1.8 percent stake in Stamford Tyres will strengthen our relationship further.â€"
The Group's foray into the South African market has piqued the interest of SRI. In Feburary
2009, the Group was appointed as Falken distributor and officially launched the brand in
October 2009. For the three months ended 31 July 2010 (â€œ1Q2011â€), the Group's South
African business contributed 11 percent of the Group's revenue.
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Press release from Stamford Tyres
Announcement of new shares from Stamford Tyres