Toyo Tire & Rubber plans to sell of its diversified non-automotive businesses to focus exclusively on its mainstay tyre business, according to reports in Japan.
Operations up for sale include the industrial materials plant in Hyogo Prefecture and a urethane plane in Kanagawa Prefecture, which makes shock-absorbing materials for the construction industry.
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Included in the disposal will be manufacturing operations for various products including rubber hosing and waterproofing materials. These generate around JPY30bn (US$263m) in annual revenue – equivalent to 10% of group sales.
The decision to sell off its non-core operations came as the group booked an extraordinary loss of JPY110bn after it came to light that fake data had been used for its seismic shock absorbers, according to local reports.
The tyre business generates around 80% of group sales with other automotive products, such as anti-vibration products and seat cushions, accounting for a further 10%.
Proceeds from the disposal will go towards expanding the company export-oriented tyre plant in Malaysia and to strengthen R&D, including setting up a design centre in the US by 2018.
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By GlobalData
