HANNOVER, Germany (Jan. 11, 2017) — Continental A.G. is selling its minority ownership stake in General Tyre & Rubber Co. of Pakistan Ltd. (GTR) but will continue a technical service and trademark royalty agreement with the Pakastani company.
Conti holds a 9.78-percent stake — 5.84 million shares — in GTR through its Continental Global Holding Netherlands B.V unit. The holding is valued at about $15.2 million, according to the prevailing rupee/dollar exchange rate.
Conti did not give any reason for the divestment.
Based in Karachi, Pakistan, GTR reported fiscal 2016 sales of $94.3 million for the year ended June 30.
Conti's shareholding makes it GTR's third largest shareholder, according to GTR documents. Pakistan Kuwait Investment Co. (Pvt.) Ltd. and Bibojee Services (Pvt.) Ltd. are GTR's two single largest shareholders, with 30- and 27.8-percent shares, respectively.
GTR was founded in 1963 as a subsidiary of General Tire & Rubber Co. of the U.S. through its General Tire International Corp. unit. GTIC sold a 90-percent stake in the company in 1977 to Bibojee Services.
GTR's annual production capacity at its single plant in Karachi stands at 2.5 million tires, which the company claims is about one-third of the country's demand. The company makes car, light commercial vehicle, truck/bus, tractor and two/three-wheeler tires.