Apollo will hold a 100% stake in Dunlop South Africa, which was valued at $200 million.
The transaction is subject to regulatory approvals in both countries, including that of the South African Competition Commission, and includes Dunlop South Africa subsidiaries in Zimbabwe and the United Kingdom.
Speaking on the acquisition after Apollo’s board meeting, chairman and managing director Onkar Kanwar said: “We have been in close contact with the Dunlop management for some time and have been very impressed with their range of products and the professional manner in which the company is managed. Their commitment and desire to be a technology-driven force in the international markets is apparent from Dunlop’s people, factories and distribution network. This acquisition opens up new avenues for Apollo Tyres. We will add value to Dunlop South Africa, and the combined entity will become an even stronger force to reckon with in the coming years.”
The deal marks the first time an Indian tiremaker has undertaken an acquisition outside of its native country, Apollo Tyres said, and the move makes Apollo Tyres “the undisputed number one Indian tire manufacturer in terms of size, reach, technology and range of products.”
Apollo officials said they expect the acquisition to be a “springboard to position Apollo as a global player.
As part of the deal, Apollo acquires Dunlop South Africa’s three tire plants, located in South Africa and Zimbabwe, which produce a range of bias and radial passenger and performance, truck and bus, industrial, farm, light truck and OTR tires. The company exports to Europe, Central Asia, Australia and South America, and is the sole distributor of Cooper branded tires southern Africa.
Through the acquisition, Apollo will also gain a substantial share in National Tyre Services (NTS) of Zimbabwe, which was described as “a major tire distributor and retreading company with a technical agreement with Bandag Inc."