Tokyo – Following the completion of its $1.18-billion (€1.06-billion) deal to purchase Alliance Tire Group BV (ATG) on 1 July, Yokohama Rubber Co. Ltd has now appointed Toru Kobayashi as executive vice-president and chairman of Alliance Tire Group.
Yokohama announced the purchase of all the share of Mumbai, India-based ATG group from global investment firm KKR & Co. L.P. and other concerned parties in March.
As ERJ reported, the addition of ATG will expand Yokohama’s OTR tire business significantly: marking the Japanese maker’s entry into the agricultural tire sector.
KKR bought a controlling stake in ATG in April 2013 from an affiliate of private equity firm Warburg Pincus. Yogesh Mahansaria, founder of ATG, retained an undisclosed ownership stake in the company.
Alliance reported sales of $529 million in fiscal 2015, according to YRC, with an operating profit of $95 million. The company has three tire plants – in Hadera, Israel; and Tirunelveli and Dahej, India, the latter of which opened in late 2014. ATG also contracts out production to manufacturers in China and Taiwan.
It goes to market with three brands: Alliance, Galaxy and Primex.
YRC produces OTR tires at a plant in Onomichi, Japan, and via an off-take agreement with Shandong Xingda Tyre Co. Ltd. of Dongying, Shandong, China, but it does not produce or sell agricultural tires.
Yokohama noted it expects demand for farm and forestry tires to increase as a result of the growing use of agricultural machinery, which it said is crucial to improve agricultural efficiency to meet the increasing food needs for the world’s growing population.
Yokohama disclosed plans in early 2015 to commit $1 billion in investment over five years to expand and upgrade its tire production worldwide, increasing annual production capacity 13 percent by 2017 and nearly 31 percent by 2020.
It recently earned a top supplier award from Caterpillar Inc. in the heavy-equipment maker’s Supplier Quality Excellence Process.
Warburg Pincus and Mahansaria joined forces in July 2007 to acquire majority control of what previously was known as Alliance Tire Co. (1992) Ltd. of Hadera, Israel, in a deal valued at $150 million.