After months of speculation and negotiations, a deal has been struck that will join Russia’s two largest tiremakers – Amtel-Vredestein and Sibur-Russian Tyres.

In the deal, Sibur Holding, part of the powerful OAO Gazprom's Gazprombank Group, will acquire controlling interest in A-V after selling its Sibur-Russian Tyres unit to A-V in a stock deal. Under terms of the agreement, A-V will ‘buy’ Sibur-Russian Tyres for some 160 million shares of stock. Sibur Holding, in turn, will acquire the newly joined tire company for $50 million in stock purchases and an additional $150 million though placement of other shares.

After all is said and done, Sibur Holding will own a 70% stake in the new company.

Over the past year, A-V has suffered from serious debt troubles related to its massive acquisition and growth strategy in which it bought out the now sold Moscow Tyre Plant and dozens of retail stores across Russia.

Sibur-Russian Tyres will provide the combined tire company – as yet unnamed – with $40 million in interim funding. (Tire Review/Akron)

About SIBUR Company
Holding «SIBUR – Russian Tyres» is the largest tyre–manufacturing company in Central and Eastern Europe. At present «SIBUR — Russian tyres» Holding holds steady position among the 20 major tyre companies of the world.

At year-end 2007 «SIBUR— Russian tyres» shares about 33% of tyre production in Russia (about 12,4 mln. tyres per year).

«SIBUR— Russian tyres» supplies about 400 tyre models both to individual consumers and for almost every branch of industry. The company leads in production of a whole range of tyre types. For instance, its share of aviation tyres market in Russia makes about 60%, agro tyres – 33%, commercial tyres — 24%, passenger tyres– 12%, light-truck tyres – 26%.

Sale of «SIBUR— Russian tyres» Holding products is performed both through headquarters in Moscow and 5 branches in Russia, and through a network of 150 distributor, providing representation of SRT products in all Russian regions and in the foreign market (22 % of SRT products goes to export, the products are supplied into more than 50 countries of the world).

In Russia «SIBUR— Russian tyres» Holding supplies the major enterprises. Among corporate clients of the holding are – major automotive companies (AvtoVAZ, UAZ, GAZ, Krasnoyarsk combine plant); leading oil and gas, extracting, energy, construction companies (Gasprom, Russian Railways, Mosgortrans, «Norilskiy nickel»); as well as the Ministry for defense, Ministry for internal affairs, Ministry of emergency situations and other enterprises and entities

SOURCE: Press and Corporate -- 30 Jun 08