Kal takes majority stake in UK's OTR Tyres Ltd

ERJ staff report (TB)

Alfreton, England -- Kal Tire has acquired a 51-percent interest in OTR Tyres Ltd. of Alfreton, creating a global earthmover tyre services company with resources in North and South America, Europe, Africa and Australia.

The new partners did not disclose the size of Kal's investment or equity stake in OTR Tyres, an OTR tire distributor, retreader and service provider with operations in 10 countries in Europe and Africa.

Bob Wallis, president of Kal Tire's mining group, said the two companies “operate in complementary markets rather than overlap,…both have developed similar standardised operating procedures, and both have a passion for providing the customer with the best service possible.”

In comments contained in an OTR Tyres monthly newsletter, Mr. Wallis said Kal Tire was drawn to OTR Tyres because the company “shares our passion for earning customer trust and for providing best careers to its team members.…”

Mr. Wallis also said strategically the deal will allow Kal to “offer global mining companies best-in-class products and services at all of their mine sites around the world.”

“Over the past decade,” he said, “we've witnessed the consolidation and transformation of regional mining companies into incredibly large global entities. At the same time as the mining companies have spread their operations around the world, they have demanded more from their suppliers.”

OTR Group Managing Director Skelton said the “investment represents the most significant global transaction in the earthmover tire service industry, as it sees the creation of the first truly global earthmover tire service company.”

Mr. Skelton, who continues as the minority shareholder, said the deal is the “culmination of lengthy discussions” between OTR Tyres and Kal Tire.

Besides its activities in the United Kingdom, OTR Tyres has operations in Australia, Botswana, Egypt, Ghana, Mali, Norway, South Africa, Tanzania and Zambia. Among its assets are OTR tire retread plants in Australia, Ghana and at the firms' headquarters in Alfreton.

Kal brings to the partnership its OTR activities in Canada, Mexico, Argentina, Bolivia, Chile, Colombia, Mexico and Panama.

From Tire Business (A Crain publication)