Dr Raghupati Singhania, Chairman, JK Tyre: “The Transaction is a reflection of the inherent strength of the Company in undertaking acquisitions with turnaround potential."

JK Tyre & Industries Limited (JK Tyre) and JK Asia Pacific Singapore Pte Limited, a wholly owned subsidiary of JK Tyre, have signed a binding term sheet with Kesoram Industries Limited (KIL) to acquire one hundred percent equity in Cavendish Industries Limited (CIL). CIL houses a Tyre Business Undertaking located at Haridwar (Laksar) which manufactures a range of tyres, tubes and flaps.

JK Group has agreed for this acquisition at an enterprise value not exceeding Rs2,200 crore, subject to conditions, wherein JK Tyre will hold the largest shareholding block and shall have substantial management control of CIL with an option to place up to 55 percent with its Associates/Group Companies.

The acquisition is proposed to be funded, by combination of debt and internal accruals raised by JK Tyre  and other JK Group entities. The financial exposure of JK Tyre in the acquisition is expected to be of the order of Rs450 crore. The final transaction is expected to consummate over next few months (subject to various approvals) with definitive documentation expected to be executed between the Parties in due course of time.

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