NEWS

Hankook Tire to enter car parts business

Wednesday, Dec 17, 2014

Hankook Tire, the nation’s largest car tire maker, confirmed Tuesday that it is considering a bid to take over Halla Visteon Climate Control Corp. in collaboration with Hahn & Company, a local private equity firm.

“It is true that the company is in talks with Hahn & Company to make an equity investment in the car parts maker in an effort to expand its business domains,’’ said Lee Joo-hak, a spokesperson of the tire maker.

Industry watchers forecast that Hankook Tire is expected to secure a 30 percent stake in HVCC, but the company official said details of the investment has yet to be decided.

HVCC, which was taken over by German supplier Viesteon in 2012, is a leading automotive thermal management solution provider. Its key customers include world leading auto giants, General Motors, Ford Motor, Tesla Motors, BMW Group and Mercedes-Benz. It operates 35 plants in North and South America, Europe and Asia.

Hankook Tire, founded in 1941, has grown into the world’s seventh largest tire maker, posting 7.07 trillion won ($6.5 billion) in sales last year. Despite the business success, however, the company has sought business diversification beyond its core tire business in the face of market saturation.

The company has been looking for alternative income sources for the past few years, concerned about its dependency on the tire business. As of 2014, more than 90 percent of the company’s sales come from the tire business.

In a bid to expand its business, Hankook Tire also joined a bid to acquire KT Rental, the nation’s biggest car rental service provider, last month. The company is seeking the deal for synergies between a car rental business and its mainstay tire-making business.

 

Source : http://www.koreaherald.com/