INDIA: Exit from Michelin joint venture not a setback for Apollo Tyres'
Source: Daily "The Hindu Business Line", New Delhi; 3 Oct 2005
New Delhi , Oct 2 APOLLO Tyres Ltd does not see its exit from the Michelin Apollo Tyres Pvt Ltd (MATPL), a 51: 49 joint venture company with the Michelin group, as a "setback" in its efforts towards getting a slice of the high-potential truck and bus radial segment pie. "We will evolve a strategy for the truck and bus radial segment in the coming days. Our exit from the joint venture does not mean that we have had a setback or would not foray into truck and bus radial manufacturing in the future," Mr Sunam Sarkar, a member on the Apollo board, told Business Line. The company and the Michelin group on Friday agreed to "realign their business plans" and announced Apollo's exit from MATPL. Apollo Tyres had invested close to $10 million in the joint venture company, which was set up to manufacture truck and bus radial tyre for the domestic market. Mr Sarkar said that the slow pace of radialisation in the Indian truck and bus tyre segment (contributed by somewhat moderate progress in infrastructure build-up) had prompted Apollo Tyres to take a close look at its engagement with the joint venture company. "We will get almost entire amount invested in the joint venture company. We have neither lost or gained in financial terms," Mr Sarkar said. He added that the Michelin group would continue to hold the 14.9 per cent stake it acquired in Apollo Tyres two years ago. (Syed Rashid Ali, Karachi, Pakistan)