MUMBAI, India (Feb. 9, 2006) — JK Industries Ltd. intends to spin off its tire activities into an as-yet unnamed separate undertaking.
JK Industries, India's No. 3 tire maker and the world's 20th largest tire maker with annual sales of about $500 million, said the spinoff would provide the tire business with an “opportunity for more focused approach and enable value maximization to all the stakeholders.”
JK disclosed its intention Feb. 8 in a memo to the BSE, the Indian stock exchange in Mumbai.
In its announcement, JK emphasized that it recently had invested $35 million to expand its radial capacity for truck and passenger tires by 50 percent and 30 percent, respectively. It claims to have about 85 percent of domestic capacity for radial truck tires.
JK also stressed that it was No. 1 in the Tire Customer Satisfaction Index Study conducted by JD Power Asia Pacific 2005 India.
JK is being advised by Ernst & Young Pvt Ltd (E&Y) and M/s Amarchand Mangaldas & Suresh A Shroff & Co (AMSS).
JK Industries is part of a broader JK organization whose activities include paper, cement, drugs and pharmaceuticals, agri genetics, dairy and food products, cosmetics, textiles, steel, industrial rubber products, etc.