Guessing game over JK-Birla ‘deal’

Speculative media reports about Indian tyre maker JK Tyre’s move to acquire Birla Tyres from Kesoram Industries have caught the tyre industry in a guessing game. While JK Tyre has denied the report that appeared in The Economic Times, the issue has already been taken forward by the All India Tyre Dealers’ Federation (AITDF) alleging that any such acquisition will only strengthen the domestic “tyre cartel.”

The Economic Times reported that JK Tyre was leading the move to buy out Birla Tyres, now part of Kesoram Industries in a deal worth over Rs20 billion (about USD202 million). The daily had quoted “two personsfamiliar with the matter.”

JK has denied the report and has informed the Bombay Stock Exchange that there is no such move. However, this has not put an end to speculations.

The All India Tyre Dealers’ Federation (AITDF), has said that “the Ministry of Commerce and Industry, Corporate Affairs Ministry and most importantly  Hon’ble Competition Commission of India (CCI) will not allow this takeover, which will further strength the domestic Tyre cartel.”

Earlier there was a report in the same daily about MRF moving in to buy Kesoram Industries.

JK Tyre, which had acquired Karnataka-based Vibrant Tyre recently, is currently facing probe by the Competition Commission of India on alleged price rigging along with Apollo Tyres, MRF, CEAT and Birla Tyres.

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