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Nokian Tyres to build car tyre plant in Kazakhstan with local company
Oct 19, 2007, Forbes.com
HELSINKI (Thomson Financial) - Nokian Tyres said it will take an initial 10 pct stake in a newly formed venture that plans to produce up to 4 mln car tyres a year at a plant in Kazakhstan, with the option to gain a majority holding later.
The Finnish company, which recently confirmed its interest in setting up a manufacturing facility in the country, will form the venture with Kazakh company Ordabasy Corporation JSC.
The new company is to spend 160 mln eur, financed through equity and loans, on building a plant in the Kazakh capital Astana.
In the first few years of operation the plant will produce mainly Nokian and Nordman branded tyres for sale in Kazakhstan and Russia, as well as other central Asian and eastern Europen markets, Nokian Tyres said.
The site is to start up in 2009, and is expected to reach a maximum production capacity of some 4 mln car tyres a year by 2012-2013. Nokian Tyres said 35-65 pct of capacity will be reserved for its own products during the first five years of operation, and 35 pct thereafter.
The company has an option to raise its ownership of the venture from 10 pct to a minimum of 50 pct.