ECONOMYNEXT – France-based Michelin said it was selling two plants in Sri Lanka that made bias tyres and tracks for compact construction equipment to India’s CEAT group.
In addition to the production facilities, the sale will also include the Camso brand, at the end of a three-year licensing period.
“The Group also intends to continue its other manufacturing activities in Sri Lanka,” a statement said.
“The country remains important for Michelin, where the company plans to continue modernizing its production facilities alongside improving performance – as everywhere in the Group.”
Separately Michelin said it will also stop production of bias tyres at its factory in Poland as part of a plan to exit from its activities related to Compact Line bias tires and Construction tracks.
It will continue to produce radial tires, solid tires and assemblies.
““Michelin firmly believes that CEAT is the right fit to carry on our bias tires and tracks for compact Construction equipment business,” Nour Bouhassoun, Senior Vice President, Beyond Road Business Line at Michelin, said in a statement.
“Both our companies are fully committed to ensuring a smooth transition for our employees and business continuity for our customers and suppliers.”
Michelin acquired the plants in Sri Lanka from then-Canada based Camso group. The solid tyre and track group was originally set up as Loadstar by a Belgian investor who sold the business to Camso.
“The Camso brand is an excellent fit with the growth strategy of CEAT’s Off-Highway tire business, thereby improving our margin profile,” Arnab Banerjee, Managing Director & CEO of CEAT, said in the statement.
“Access to the most premium customers, a high-quality brand and a qualified workforce is what excites us the most about this acquisition.
“The track segment is a technologically superior segment with a limited number of global players.
“We also found high synergies between the two brands, CEAT and Camso, and are confident that both will benefit tremendously from their complimentary capabilities and positioning.”
There are 15 plants and 5,000 employees at plants in Sri Lanka, according to the Camso website. (Colombo/Nov06/2024)
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