The Hindu Business Line : Apollo Tyres in talks to buy Dunlop Zimbabwe?

HAS Apollo Tyres Ltd set its sights on the ailing Dunlop Zimbabwe? The news was first published in a South African paper Financial Gazette on January 18.

When contacted Apollo Tyres neither confirmed nor denied the news. "We always talk to a lot of companies for different types of arrangements. We do not have anything more to say," a company official said in Delhi.

Industry sources, however, indicate that there is a clear market buzz about the tyre major looking for an acquisition in South Africa or in its neighbourhood.

Financial Gazette and others who had followed the news, however, sound quite specific. "Apollo officials visited the country late last year to hammer out the deal with Dunlop Zimbabwe and contracted a Harare law firm, Scanlen & Holderness, to oversee a due diligence examination. Scanlen & Holderness, in turn signed up Bulawayo-based legal practitioners Webb, Low and Barry to conduct the exercise on their behalf. The due diligence exercise was completed mid-December," the newspaper says quoting industry sources.

According to the newspaper, Dunlop Zimbabwe is heavily dependent on raw material imports and was suffering from acute foreign currency crisis leading to a suspension of operations last year. The company was later re-opened last year following government intervention.

According to the newspaper, Dunlop International which controls 75 per cent stake in the Zimbabwe-based tyre manufacturer did not deny the speculation regarding a possible takeover by Apollo either.

"We are talking to a number of people," the Dunlop International CEO, Mr Mark Hankinson, reportedly told Financial Gazette.

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