The European Bank for Reconstruction and Development (EBRD) is to invest $US20 million in a Russian tyre manufacturing plant being built by France’s Michelin group.
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The bank says Michelin is the first western tyre manufacturer to establish a Russia-based production line for the local market.
Under the deal, the EBRD will gain a 49% stake in the plant being built at Davydovo, 60 miles (100 kilometres) east of Moscow, with Michelin owning the remaining shares.
When it reaches full capacity in 2005, the plant’s potential output will be 2.1 million tyres per annum. Michelin wants to rely increasingly on local suppliers for raw materials once these meet necessary quality standards.
