Financial Daily from THE HINDU group of publications
Thursday, Dec 08, 2005
Financial Daily from THE HINDU group of publications Thursday, Dec 08, 2005 |
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Corporate
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Mergers & Acquisitions Tyre dealers hail Ruia's takeover of Dunlop Our Bureau
Kolkata , Dec. 7 ALL-India Tyre Dealers' Federation (AITDF) has hailed Ruia Group's `daring decision' to take over Dunlop India Ltd. AITDF believes that Dunlop's re-entry will infuse competition in the tyre industry, which is currently controlled by four or five large players. The federation convenor, Mr S.P. Singh, said that during last seven years the industry had witnessed the exit of three large players namely Dunlop, Modi Rubber and Modistone (formerly Firestone), which had a combined annual capacity of 4.5 million tyres. The exit of Dunlop, the largest of the lot, had affected the tyre trading sector most. "Tyre dealers had to incur loss of business and capital solely due to mishandling of Dunlop affairs by the previous management." Dunlop India has a strong edge in off-the-road (OTR) tyres used in mining and other such equipment, Mr Singh said, adding that the company's closure had paved way for large-scale import of such tyres. "Today Dunlop South Africa is one of the major exporters of OTR tyres to the country. This is irrespective of the fact that the imported product has little or no qualitative difference with Dunlop India products," he added. According to the federation, apart from OTR tyres, Dunlop has an advantage in truck-bus tyres, tractors tyres, two wheeler and auto rickshaw tyres, animal drawn vehicle tyres, and so on. The company also has a unique range of rubber industrial products and tyres for defence requirement. The AITDF convener believes that except for passenger car radial tyres (which is two per cent of the 17.5 million truck-bus tyre market), the technology available with Dunlop is at par (if not better) with that of the leading players in the segment.
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