The facility in Vsevolozhsk, Russia, shown here in 2020.
NOKIA, Finland—Nokian Tyres P.L.C. has concluded the sale of its Russian assets, including its tire factory in Vsevolozhsk, to Russian energy and petrochemicals producer P.J.S.C. Tatneft.
Nokian said the sale price of 23.1 billion rubles (approximately $307 million) was determined by the Russian Governmental Commission, which also determined the ruble/euro exchange rate by which the deal was concluded.
There are still some registration formalities in Russia to be concluded before the deal is completed, ending Nokian Tyres' operations in Russia.
"Due to the war in Ukraine it was no longer feasible nor sustainable for Nokian Tyres to continue operations in Russia," Nokian Tyres President and CEO Jukka Moisio said.
"The exit process has been long, but we are satisfied that we are in the final stage of completing it. Our focus is now fully on building the new Nokian Tyres, and we are excited about our new direction," Moisio said, referring to the company's decision to build a factory in Romania to replace the capacity lost with the divestment of the Russian plant.
Nokian and Tatneft disclosed their agreement on Oct. 28, 2022,with an expected sale price of approximately 400 million euro, or $429 million in U.S. funds at that time.
The final impacts of the transaction will be disclosed in the first quarter 2023 interim report on April 25, Nokian said.
In addition to the new plant in Romania, Nokian has struck an off-take production agreement China's Qingdao Sentury Tire Co. Ltd. for Qingdao to make Nokian-brand tires under contract in China for Nokian to sell in central Europe and disclosed plans to expand capacity at its four-year-old factory in Dayton, Tenn., and build a warehouse nearby to house the products.
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