Fri October 1 08:00 am 2004 in category Stock exchange releases
NOKIAN TYRES IS GOING TO SELL ITS BICYCLE TYRES BUSINESS
Nokian Tyres is going to sell its bicycle tyres business to Suomen Rengastehdas Oy being established. The buyer will continue to run and develop the bicycle tyre business in the town of Lieksa in Finland. The new owner will also take over the manufacture of heavy inner tubes and provide contract manufacturing services to Nokian Tyres in this area.
Nokian Tyres’ personnel, a total of 59 persons, working at the Bicycle Tyres profit centre and in heavy inner tubes manufacture will be employed by the new owner under their existing contracts, effective as of 1 December 2004.
The buyer, Suomen Rengastehdas Oy, is a subsidiary of Suomen Kumitehdas Oy. The companies are engaged in the manufacture of bicycle tyres, rubber boots, footwear and other rubber products, and in the reprocessing of rubber. The principal owners of the companies are Mr. Arto Huhtinen and Mrs. Tuire Erkkilä, both previously members of Nokian Jalkineet Oy’s (Nokian Footwear) management.
The deal is conditional and will be finalised provided that Lieksan Teollisuuskylä Oy purchases the Lieksa facility. The real estate deal requires the approval of the Lieksa town council. The deal is scheduled to be finalised on 30 November 2004.
The total sale price comprising the business operations and the real estate is EUR 3.6 million.
Good business development potential“Nokian Tyres has been looking for a buyer for its bicycle tyre business that could continue and develop the already very healthy business. The buyers are in an excellent position to do this,” estimates Antero Turunen, Vice President, Heavy Tyres and Bicycle Tyres.
In 2003, Nokian Bicycle Tyres generated net sales of EUR 5.1 million and recorded an operating profit of EUR 0.5 million.
The Lieksa plant manufactured 784,000 bicycle tyres as well as inner tubes for heavy tyres in 2003.
Nokian Tyres plc
Vice President, Communications and IR
For further information, please contact: Antero Turunen, Vice President, tel. +358 3 340 7231
Distribution: OMX and major media