HANOVER, Germany — Continental A.G. has made an offer to purchase 51 percent of Slovak Republic´s Matador A.S. rubber business.
The companies did not disclose the value of Conti´s offer, subject to the approval of antitrust authorities. Matador reported sales of $619 million with 4,770 employees in fiscal 2006.
Conti said it would invest an undisclosed sum to expand passenger and light truck tire production at Matador´s Puchov, Slovak Republic, headquarters factory by more than 27 percent to 7 million units a year.
Conti and Matador already are involved in a truck tire joint venture at Puchov. The deal also would include Matador´s conveyor belt production in Puchov and its share of a joint venture tire plant in Omsk, Russia.
"With this move we are strengthening our ties to our highly successful joint venture partner," said Manfred Wennemer, Continental´s executive board chairman. "At the same time we are expanding our operational base in eastern Europe markets as well as our production capacities for (passenger and light truck) tires in low-cost countries."
Matador Rubber CEO Stefan Rosina said the strategic alliance will further improve the quality and volume of Matador tire production, open new markets and increase the value of the Matador brand.
"We are, moreover, also strengthening our position in automotive-our second strategic business," he said. "After excellent experiences with our truck tire joint venture, we are sure that this partnership will be the best solution for the future of Matador and also for our employees."
The deal will help Conti and Matador improve their market positions in central and eastern Europe and open additional sales opportunities in Russia, Ukraine and the former Soviet states, Wennemer said.
In particular, he said, Conti´s position in Russia will be expanded through better access to the market and having production through the Matador-Omskshina joint venture.
Wennemer said expanding Puchov´s passenger/light truck tire capacity will be a "highly efficient tool to be used against low-cost competition."
Conti also plans to integrate Matador´s rubber processing machinery business into its own machinery operations at its plant in Hanover-Stoecken, Germany.