Apollo Tyres sheds 5% amid $900 million Kumho bid news

NEW DELHI: Shares of Apollo Tyres shed over 5 per cent in Tuesday’s trade after Economic Times said, quoting sources, that the tyremaker was competing with Chinese rivals Shandong Linglong Tyre and ChinaChem to acquire South Korea's second largest tyremaker Kumho Tire in a deal estimated at around $900 million.

If the Indian company is successful in its bid, the deal will create a tyremaker that will rank among the top seven in the world with strong presence in the US and Europe, ET reported.

However, sentiment on the counter remained muted. By 10.50 am, the stock had hit a low of Rs 182.20, which was 5.32 per cent lower than its previous close of Rs 192.45.

A 42 per cent stake in Kumho would be worth about 663 billion won ($568 million) based on Friday’s closing price. But there will be a significant control premium attached to the price, the report said.

Apollo Tyres had previously failed in its $2.5 billion bid to buy Cooper Tire of the US two years ago.