CLERMONT-FERRAND, France (Sept. 8, 2011)—Michelin, Double Coin Holdings Ltd. and Shanghai Huayi (Group) Co. agreed to final terms covering the creation of their joint venture in China to produce and market Warrior-brand passenger car and light truck tires.
Double Coin and its parent Shaghai Huayi will own 60 percent of the new company, Double Coin Group (Anhui) Warrior Tires Co., with Michelin controlling 40 percent. Michelin said it will pay about $104 million in capital to the venture, which now will take control of a plant under construction in Wuwei, Anhui Province.
The agreement is subject to approval by the appropriate Chinese authorities, Michelin said.
Representing an investment of nearly $550 million, the Wuwei project calls for building a plant capable of producing 15 million car and light truck tires annually for the local market, Michelin said.
Michelin and Double Coin originally announced their intent to form a joint venture in April. The deal re-establishes a business relationship between Michelin and Double Coin about two years after Michelin bought out Double Coin's minority share of the Shanghai Michelin Warrior Tire Co. Ltd. venture they'd owned jointly since 2001.