Cooper Tire and Rubber has signed an agreement to acquire the assets of an existing tyre plant in Kruševac, Serbia, some 200km south of Belgrade.
The new wholly-owned subsidiary, to be known as Cooper Tire Serbia, will complement Cooper’s well-established European operations and product offerings, including high-performance tyres manufactured at the company’s Melksham, England, facility.
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Including an initial investment of around EUR13m (US$17.4m) and with the Serbian government supporting the project in what are described as “several ways,” the company plans to invest more than EUR50m in the operations during the next three years. Support from the Serbian government could total a possible EUR10m million if goals are achieved.
Hal Miller, president of Cooper’s international tyre segment, said, “The Serbian government is very supportive of this transaction and promoted the benefits of the location, labour force and the competitiveness in the region.
“As a global tyre company, developing this well-situated source of quality supply will benefit customers, employees and our shareholders. We are extremely excited about the momentum we are building and the role this operation will play in our future.”
Addressing the timetable for the new operations, Julian Baldwin, vice president and managing director of Cooper European operations, said: “We look forward to working with the experienced local work force in preparing to produce tyres in Krusevac.
“The plant will initially employ 400 [people] with plans to grow to a production capacity of three million tyres with 600 to 700 employees within three years. There is room for even greater capacity with further investment in the business.”
The transaction is expected to close during the first quarter of 2012 and is subject to regulatory approvals, confirmatory due diligence and other conditions.
