Conti closes acquisition of Modi Tyre unit

ERJ staff report (DS)

Hanover, Germany -- Continental AG has acquired 100 percent shareholding in Modi Tyres Company Limited (MTCL), a subsidiary of Modi Rubber LTD. Further to an initial announcement in April, Continental confirms that it has now received the necessary regulatory clearances and has completed the acquisition. The purchase price consideration for 100 percent of the shares of MTCL is approx. 18.5 million Euros. Both parties have agreed to keep other commercial details of the transaction confidential.

MTCL has now become a fully owned subsidiary of Continental Corporation and will be renamed as Continental Tyres India Limited. The new entity will focus on local production and distribution of bias and radial truck and bus tyres as well as radial passenger car tyres for the Indian market.

Continental Tyres India Ltd will have its registered office in Delhi with manufacturing facilities both in Modipuram and Partapur. Currently, an integration team works jointly with the new employees on achieving an optimal start for Continental Tyres India with the full set of resources now available from Continental.

Modi Rubber Ltd has informed BSE that the sale by the Company of its entire shareholding in Modi Tyres Company Limited, represented by 56,046,680 equity shares of Modi Tyres Company Limited has been closed on July 15, 2011 and completed for a share purchase consideration of (approx) INR 117,61,89,838 and a non compete fee net of withholding tax in the sum of INR 172,295,100.

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Press release from Continental

Stock exchange announcement from Modi Rubber

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Germany's Continental pays $30 mln for Modi Rubber unit Reuters (India)

Germany's Continental acquires Modi Tyres for Rs134 crore news Domain-B (India)

Modi Rubber shares rise 5 pc on tyre unit sale Economic Times (India)

Modi Rubber shares gain on tyre unit sale The Hindu Business Line (India)