MUMBAI, India (Nov. 30, 2010) — Indian tire maker CEAT Ltd. is acquiring global rights to the Ceat brand name from Pirelli & C. S.p.A. for $12 million to enable it to expand its export business beyond South Asia.
Ceat, a unit of India's RPG Group, owns the rights to the Ceat brand in nine countries: Afghanistan, Bangladesh, Bhutan, India, Myanmar, Nepal, Pakistan, Sri Lanka, and Vietnam. Pirelli is the owner of the Ceat trademark in the rest of the world.
CEAT was an independent Italian tire maker that expanded to India in the late 1950s. Pirelli acquired Ceat in the 1970s and sold the Indian business to RPG in 1981. CEAT is an abbreviation for Cavi Electrici Affini Torino (Electrical Cables & Allied Products of Turin).
CEAT said this acquisition will enable it to export Ceat-brand radial and bias-ply tires globally and to outsource tires under the brand. CEAT uses its Altura brand for exporting to markets in Europe and South America. Tyres International Inc. of Stow, Ohio, handles the Altura brand in the U.S.
Once the deal closes, CEAT will own all rights, title and interest in the Ceat brand in the territories where Pirelli previously owned registrations for the Ceat brand and for brand registration classes therein identified, CEAT said, with a few caveats.
Pirelli will continue to hold exclusive license until Dec. 31, 2011, to use the brand in relation to radial tires in Europe, Latin America, Turkey and Mexico and bias-ply tires in Latin America, Turkey and Mexico.
The deal also includes a non-exclusive license to Pirelli to use the brand in relation to both radial and bias-ply tires worldwide until Dec. 31, 2012, excluding the nine countries where Ceat Ltd. owns the brand completely.
CEAT Ltd., the world's No. 32 tire maker with 2009 sales of $597 million, was established in 1958. The company makes more than 10 million car, light truck, medium truck, motorcycle, OTR, trailer and industrial tires a year at plants in Mumbai and Nasik, India, and Kalutara, Sri Lanka.
Commercial tires dominate the mix at more than 85 percent of sales. Exports account for about 17 percent of sales.