French tire manufacturer Michelin has completed its previously announced acquisition of a stake of 88% in Indonesian tire manufacturer Multistrada Arah Sarana for $480 million, after securing all the required approvals.

The deal was announced by Michelin in late January in a move to gain competitive production capacity of over 180,000 tons and to bolster its footprint in the rapidly growing Indonesian market.

Multistrada, which has a capacity of manufacturing more than 11 million passenger car tires, nine million two-wheel tires, and 2,50,000 truck tires, registered $281 million in net sales in 2017.

Through the transaction, Michelin also gets a 20% stake in Indonesian tire retailer Penta Artha Impressi along with 50 hectares of available land.

The French tire manufacturer has also acquired the local brands – Achiles and Corsa and a competitive local plant with quality facilities and immediately available production capacity as part of the transaction.

Michelin plans to convert production from Tier 3 Passenger car tires to Tier 2 Michelin Group brands gradually. This will enable more Tier 1 production at other Asian tire manufacturing plants and address the growing demand for Tier 2 volumes in Europe, Asia and North America, said the French tire manufacturer.

Michelin said that it is looking to acquire the remaining 12% stake in Multistrada, which is a publicly listed company. The French company said that it has launched a public offer to buy out the remaining shares in Multistrada at the same price per share offered for the 88% stake.

  France, Indonesia, Michelin, Multistrada Arah Sarana, Penta Artha Impressi, Tire manufacturer