Page 80 - The Tyreman 2019 -1
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international tyre news
Michelin Acquires Indonesia Tyre Manufacturer Multistrada
Michelin recently acquired leading Indonesian tyre manufacturer PT Multistrada Arah Sarana TBK, thereby gaining competitive production capacity of more than 180,000 tonnes and strength- ening its presence in the fast-growing Indonesian market.
In line with its strategy, Michelin announced it had signed an agreement to acquire 80 per cent of Multistrada, a tyre manufacturer based in Indo- nesia. With a production capacity of more than 180,000 tonnes (which equates to 11 million passenger car tyres, 9 million two-wheel tyres and 250,000 truck tyres), Multistrada generated net sales of US$281 million in 2017. With this transaction, Michelin would strengthen its presence in the highly promising but local-production dominated Indonesian market by acquiring a very competitive local plant with good quality facilities and immediately available production capacity. Leveraging on its technical expertise with limited new investment, Michelin would gradually con- vert production from Tier 3 passenger car tyres to Tier 2 Michelin Group brands, thereby allowing more Tier 1 production at other Asian plants America and Asia.
In addition, through this transaction Michelin acquired a 20-per cent stake in the retailer PT Penta Artha Impressi (Penta) in partnership with Indomobil and other private investors. This boosts the marketing and sales of the Michelin Group brands in Indonesia, allowing Michelin to from the market’s future growth and expansion.
said: “The acquisition of Multistrada represents an excellent opportunity for Michelin to expand its operations in Indonesia, the most populous country in Southeast Asia, and immediately gain competitive, good-qual- ity production capacity without having to create any new manufacturing facilities.”
very proud of what we have achieved with Multistrada and are con- fident Michelin is the ideal partner to take Multistrada forward into a new era of growth and success for the benefit of all stakeholders and employees.”
Potential synergies in manufacturing, sales and purchasing are expected to represent up to US$70 million per year within 3 years of the acquisi- tion. Multistrada, including the 20-per cent stake in the retailer PT Penta and 50 hectares of available land, is valued at US$700 million enterprise September, 2018, after expected synergies.
Upon closing, Michelin would pay US$439 million for 80 per cent of Multistrada shares subject to certain closing adjustments. As Multistra- da is a publicly listed company, and pursuant to Indonesian regulations, 80-per cent shareholder group. The acquisition would be funded from Michelin’s ratings.
80 the tyreman 2019/1
