SRF to acquire Thai tyre-cord maker Thai Baroda Industries
28 May 2008
Tyre-cord manufacturer SRF has announced that it has entered into an agreement to acquire Thailand-based tyre cord company Thai Baroda Industries Ltd. (TBIL) for around Rs100 crore, covering fixed assets and transaction costs.
As per the agreement, SRF will finance the company's working capital, and the actual transfer of management control will be subject to an approval of the rehabilitation process by the Thailand Court.
Thai Baroda produces around 12,000 tonnes annually of dipped nylon tyre cord fabric, with estimated annual sales of around $50 million.
Ashish Bharat Ram, managing director of SRF said that once the financial restructuring and subsequent takeover of the management of TBIL is complete, he was confident that turning around the company in a short time was possible.
SRF has four existing production units in India, and a wholly owned subsidiary unit in Dubai. It has a total annual production capacity for tyre cord, after this acquisition, would come to 65,000 tonnes, and making SRF the third largest tyre cord fabric manufacturer in Asia, and the fifth largest in the world.
The move will also give SRF access to the South East Asian markets. According to a Reuters report, SRF plans to retain the entire staff of TBIL, which is presently under financial restructuring. It will be a few months before SRF will get management control of TBIL.
