Hari Shankar Singhania in New Delhi on Friday. Picture by Prem Singh

Mumbai, April 11: JK Tyre & Industries will acquire Mexican tyre company Tornel for Rs 270 crore.

The purchase of a 100 per cent stake in Tornel will raise JK Tyre’s turnover to $1 billion (Rs 4,000 crore). JK Tyres already exports tyres to the North and South American markets. The deal will give it access to the economies who are part of the North American Free Trade Agreement, as Mexico is part of this trade block.

The buyout will be done through a special purpose vehicle and is expected to be complete by the end of May, subject to certain regulatory approvals.

Tornel has three operating tyre plants with an aggregate capacity of 6.6 million tyres per annum. Situated in Azcapotzalco, Tultitlan and Hidalgo, the three plants of Tornel employ 2,000 people.

The company makes tyres for trucks, light commercial vehicles, farm and industrial vehicles in one category and for trucks, LCVs and passenger cars in the radial category.

Hari Shankar Singhania, chairman of JK Tyre & Industries, said: “JK Tyre has been sourcing tyres for exports from China and Vietnam, besides its four manufacturing facilities in India. In line with our vision, this acquisition extends our global reach. The acquisition is also a strategic fit as we are already the largest exporter to the North and South American markets.”

The turnover of Tornel is $202 million, which combined with JK Tyre’s $800 million, will take the turnover of the merged entity to $1 billion. With this acquisition, JK Tyre will be ranked the 14th largest tyre manufacturer globally.