NOKIA, Finland (Feb. 24, 2003) — Bridgestone Corp. is acquiring an 18.9-percent ownership stake in Nokian Tyres P.L.C., agreeing to buy Nokia Corp.'s 2 million shares of Nokian Tyres for $73.2 million.
Bridgestone said it intends Nokian Tyres to continue as an independent company, and that the two firms will examine ways to complement each other's product development, testing and distribution operations, according to Shoshi Arakawa, chairman and CEO of Bridgestone Europe N.V./S.A.
Telecommunications equipment giant Nokia's shareholding in Nokian Tyres dates to 1994 when Nokia spun Nokian off into a separate, publicly traded entity. Nokia agreed to sell its shares to Bridgestone's Brussels, Germany-based European division.
“Nokian Tyres has an excellent record of growth and profit. Its expertise is in developing and marketing products for Nordic markets, especially winter tires. I am convinced that there are numerous synergies between our two companies, and that we can be strategic partners for the future,” Mr. Arakawa said in a prepared statement.
Nokian Tyres is considered the world's 20th largest tire maker, with about $300 million in sales in 2001. It also generates up to $150 million in sales from its extended retail tire and automotive service businesses throughout the Nordic countries. More recently, Nokian entered into a joint tire making and distribution venture in Russia and set up off-take production with Slovakia's Matador A.S.
In addition, Group Michelin makes Nokian-branded heavy farm, industrial and truck tires at its Stomil Olsztyn plant in Poland under a three-year agreement that began in 2001.
Bridgestone reported $1.94 billion in sales in Europe last year, an 11-percent gain over 2001.
The deal is conditional upon approval by the German antitrust authorities, Nokian said. The transaction may take place within two working days from the approval. If the transaction has not been effected by Aug. 31, 2003, both parties have the right to terminate the agreement, Nokian said.