Kanwar: 'Joint Ventures Are Not in Our DNA'

[Editor’s note: the following information is from an article that appeared on The Hindu Business Line on Aug. 6. To view the entire piece, click here.]

Neeraj Kanwar, son of Apollo Tyres Chairman Onkar S. Kanwar, shed some light on the recent deal to take over U.S.-based Cooper Tire & Rubber Co.

Neeraj, Apollo Tyres vice chairman and managing director, says the company cannot remain a “one brand, one country” entity any more, and needs near-shore (closer to the market) presence in large, developed markets to mark its global presence.

Apollo’s global competitors are aggressively scaling up manufacturing capacity and the ability to supply to North America, China and other large markets. And it is competing with names such as Bridgestone (Japan), Michelin (France), Yokohama (Japan) and Pirelli (Italy).

To acquire a company twice its size, Neeraj said it was in keeping with Apollo’s strategy of expanding through acquisitions. “Joint ventures are not in our DNA,” he said.

Apollo ended fiscal 2012-13 with a turnover of $2.3 billion, while Cooper’s revenues for calendar 2012 stood at $4.2 billion.

Apollo will continue to focus on India and at the same time look at newer markets so that its balance sheet remains protected.

“The deal will be concluded as per the timeline and there is no reason for anxiety. Middle of October the deal will close,” he said, addressing skepticism on Apollo’s ability to complete the Apollo deal.

This June, Apollo and Cooper announced the deal, under which a wholly-owned subsidiary of Apollo (Apollo Tyres BV) will acquire the Ohio-based company in an all-cash transaction valued at $2.5 billion. This is the largest transaction in India’s automotive industry.

The rationale behind the deal was clear, Neeraj said. Apollo acquires a profitable and scaled business in the critical markets of North America and China. It also gets a set of complementary products and brands, and reduces dependence on one market (India), according to him.

Neeraj is also clear that there will be no layoffs after the acquisition is completed, as trained manpower is an asset. Since the deal is yet to be completed Cooper is the one sorting out the issues.

The deal will help Apollo leverage the combined distribution network in Europe to sell the Vredestein, Cooper and Apollo brands. The Indian company also gets access to Cooper’s new markets such as Latin America, Russia and East Asia.

GRI recently conducted programs in Sri Lanka to empower women and motivate children under its Green x Circle initiative. The company said these endeavors aimed to address the needs of the community, focusing on both women empowerment and youth motivation.

GRI recently organized a training program titled "Management of household finance under current economic conditions" at the Ingiriya Rubber Collecting Center in Sri Lanka, South Asia led by Shashika Nimali, an NLP practitioner and life coach. The company said this initiative provided women in the industry with essential skills and knowledge to effectively manage household finances. GRI's tailored training sessions equipped participants with tools for informed decision-making, ultimately fostering greater financial security and independence, the company said.