By Jane Ho, Crain News Service
BEIJING (Jan 8, 2015) – Triangle Group Co. Ltd. is planning an initial public offering on the Shanghai Stock Exchange, according to a company prospectus published recently.
The company, one of China's largest tire makers, plans to list no more than 25 percent of its total shares after issuance on the Shanghai Stock Exchange, according to its prospectus.
The IPO recently was cleared by the China Securities Regulatory Commission.
Capital raised from the IPO will be pumped into two projects, the prospectus states, the relocation of 2 million units of annual heavy truck tire capacity and the upgrade of passenger tire plants with 8 million units of annual capacity.
The projected investment for the two projects is pegged at $385 million and $430 million, respectively.
Triangle has more than 9,000 employees and four plants in Weihai, Shandong Province, where it is based. The company has 6.3 million units of annual radial truck tire capacity, 16.5 million units of passenger tire capacity and 280,000 units of bias-ply tire capacity, with a product range of 4,200 tire models.
Triangle Tyre reported a 12-percent increase in net profit in 2014 to $226 million, while revenue dropped 9 percent to $2.1 billion. Overseas sales, which have represented more than half of revenue since 2012, accounted for 58 percent in 2014. The company sells in more than 170 countries.
Risks in international trade conflicts and depreciation of foreign currencies are warned in the prospectus. It also cautions fluctuation in the automotive sector, with 24 percent of the company's revenue coming from OE tires in 2014.
Triangle is in the process of setting up a U.S. sales office near Nashville, Tenn.
Jane Ho is a correspondent for European Rubber Journal, a United Kingdom-based sister publication of Tire Business