JK Tyre completes merger of Cavendish Industries Ltd., its subsidiary

JK Tyre & Industries Ltd., one of India's leading tyre manufacturers announced the successful completion of the merger of Cavendish Industries Ltd. (Cavendish), its subsidiary with JK Tyre & Industries Ltd

Cavendish was acquired by JK Tyre in 2016 from Kesoram Industries Ltd. Cavendish primarily had manufacturing capacity of truck/ bus radial, truck/bus bias and 2/3-wheeler tyres. At the time of acquisition Cavendish was operating at barely 30% of its Capacity.

Post acquisition, JK Tyre provided comprehensive managerial, financial and technical support leading to a swift and effective turnaround. Through systematic streamlining of manufacturing processes, this resulted in Capacity utilization of 95% . Furthermore, the capacity at Cavendish, Laksar was also expanded as a result of which it contributed sizably to the overall tyre operations of the company.

The merger is expected to unlock substantial value through enhanced operational synergies, economies of scale, a stronger and bigger diversified product portfolio, and enhanced reach across a combined distribution network.

This merger reinforces JK Tyre's long-term strategy of sustainable growth through a balanced mix of organic and inorganic initiatives. The successful integration of Cavendish marks the company's third major turnaround following the transformations of Vikrant tyres(1997-98) and JK Tornel Mexico (2008), besides two other Greenfield plants.

Shares of JK Tyre & Industries Limited was last trading in BSE at Rs. 510.40 as compared to the previous close of Rs. 490.75. The total number of shares traded during the day was 239181 in over 11707 trades.

The stock hit an intraday high of Rs. 522.30 and intraday low of 490.50. The net turnover during the day was Rs. 122268065.00.

Source : Equity Bulls

Keywords

JKTyreandIndustries INE573A01042 Merger CavendishIndustries