Vredestein now owned by Apollo Tyres

ERJ staff report (DS)

Gurgaon, India -- India headquartered Apollo Tyres Ltd has concluded the formal process of acquiring a 100% stake in the premium European tyre manufacturer Vredestein Banden BV (VBBV), based out of the Netherlands. The unit is being acquired from Vredestein's parent company, Russia's largest tyre manufacturer Amtel-Vredestein NV (AVNV). AVNV was declared bankrupt on 29 April 2009. AVNV's bankruptcy has not affected the Netherlands-based VBBV, which continues to remain a viable entity with a ring-fenced financing arrangement and a turnover of approximately Euro 307 million for CY08.

Vredestein's manufacturing unit is located in Enschede, 1.5 hours from Amsterdam. Over 70% of the 5.5 million tyres manufactured every year are high performance, high speed passenger car tyres with speed ratings up to 300 kmph and sold primarily in the European Union. Vredestein enjoys high brand recognition in Europe for its performance tyres and also manufactures a second brand called Maloya.

“This is a strategic alliance for us and will bolster Apollo's plans for its European customers,” comments Onkar S Kanwar, Chairman & Managing Director, Apollo Tyres Ltd. “The fit between the two companies spans the entire spectrum of R&D, products and people to manufacturing and markets. It is a synergistic match and our aim is to increase Vredestein's global value in the coming years.”

Vredestein Banden BV currently employs around 1,500 people and is managed by a core group of senior managers, with vast experience in the tyre industry and a strong track record of profitability. The company has constantly notched a CAGR of 8.5% in revenue over last five years, a figure that is significantly higher than the industry growth rate in Europe.

“This alliance is a win-win combination for both companies,” adds Vredestein Banden BV's Chief Executive Officer, Rob Oudshoorn. “We will bring to Apollo our edge in passenger car tyre technology alongside an understanding of the European market. At the same time, Apollo can offer us access to the non-European markets, valuable manufacturing expertise and assistance with bringing down costs by leveraging the purchasing power of a larger entity. I have closely watched Apollo's acquisition and integration with Dunlop South Africa, and the way they went about the merger speaks highly of the Apollo management's outlook on people and implementing best practices.”

This is an external link and should open in a new window. If the window does not appear, please check your pop-up blocking software. ERJ is not responsible for the content of external sites.

Press release listing from Apollo

Apollo Tyres Buys Vredestein Banden For EUR175M - Source from Wall Street Journal