Toyo Tire Corporation has hired Japanese engineering and construction company Takenaka to build its factory in Indjija, in northern Serbia, Indjija mayor Vladimir Gak said.

Takenaka was selected as the leading contractor in the project and construction works will start on 15 December, Gak said in a video file posted on the website of Tanjug news agency and cited by SeeNews.com.

"A total of EUR367m will be invested in the first phase of the project development and 537 employees will be hired, according to the investor," Gak said.

Construction works are planned to be completed within 17 months and the factory will produce 5m premium tyres per year, with its entire output to be exported, he added.

SeeNews noted that last month, Serbia's state aid commission approved the allocation of EUR41m (US$48.7m) in government financing to Belgrade-based Toyo Tire Serbia, the fully owned subsidiary of Toyo Tire Corporation, for the construction of the factory in Indjija.

Earlier this year, Toyo completed the acquisition of a 63 hectare land plot in the northeastern industrial zone of Indjija where it will build the factory with a footprint of 300,000 square metres, the report said.