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Tire Companies May Merger
The Amtel-Vredestein holding has proposed a merger with OAO SIBUR – Russian Tires. It announced yesterday that has begun preliminary consultations with the owner of the SIBUR to make it one of the largest shareholders in a unified company. In addition, Amtel-Vredestein has asked SIBUR for “short-term financing,” without specifying the amount or purpose of the loan. SIBUR confirmed the talks and said that the loan in question was a “suppliers' credit.” Both sides admitted that the talks may end without result.
A source close to the SIBUR management said that Amtel-Vredestein asked SIBUR to provide its Russian plants with synthetic rubber, an essential ingredient for tire-making that account for half the production cost. The source said that the plants may begin to close down if the issue is not settled within a week. An Amtel-Vredestein source said that preliminary talks with SIBUR began last autumn, but the Amtel-Vredestein supervisory board approved them only this week. Now the companies will begin making mutual assessments. That process will take at least two months.
Alfa Bank is Amtel-Vredestein's largest shareholder, with 26 percent. The company's capitalization in London as of yesterday was $166 million. SIBUR – Russian Tire does not publish its financial data, but a source said its receipts exceed $1 billion and its EBIDTA is around $100 million. Analysts say that those figures indicate that the company's worth is about $700 million and that its financial condition is far from ideal. Alfa Bank would become a minority shareholder in the event of a merger and the company would be the largest on the Russian market.
www.kommersant.com
All the Article in Russian as of Feb. 01, 2008
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Photo: Grigoriy Sobchenko
