Kenya's Sameer completes deal with Chinese manufacturer
ERJ staff report (TP)
Nairobi, Kenya – Sameer Africa has inked a lucrative franchise deal with a “leading Chinese tire manufacturer”, which will see the company supply cheaper tires to Sameer, as it seeks to boost sales after it last year ended ties with ex-partner Bridgestone Corporation, reported Ventures Africa.
Sameer’s contract with Bridgestone – which included manufacturing, distribution of tires and technical support – terminated last year leaving the company with the task of finding another strategic partner.
“We have already concluded a licensing agreement with a leading Chinese tire manufacturer,” said chairman of Sameer, Erastus Mwongera.
He added that specifications will be given for the manufacture of Summit tires from China, which would be made under Sameer’s direct supervision and introduced later in the year.
Following the end of its contract with Sameer, Bridgestone got a new distributor for its brands in the Kenyan market, giving Sameer a stiff competition against a brand it once had exclusive rights to.
Mwongera is however optimistic it would continue doing well in the Kenyan market with the Summit brand.
The deal is seen as strategic, as the Kenyan market now offers competitive pricing with cheaper Asian imports growing exponentially (currently stands at 50 percent of the market).
Sameer, which posted a net income of $4.6m (€3.3m) for the year ending December 2013, is also discussing the possibility of getting technical expertise in tire manufacturing from another company, just as it intends to produce new sizes and upgrade production facility.
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Full story from Ventures Africa