Apollo Tyres has convened an extraordinary general meeting on December 15 at Kochi to seek approval for technical alliance with Michelin group of France to manufacture dual-branded radial truck and bus tyres.
Michelin buys 14.9% stake in Apollo Tyres
The EGM will seek approval to allot 57,12,500 equity shares comprising 14.90 per cent of ATL's total equity to Michelin group's investing arm, Campagnie Financiere Michelin, at a price of Rs 134.82 crore (Rs 1.35 billion) through a preferential issue, a company official said.
After the agreement, the stake in ATL held by promoters and business associates would come down to 37.33 per cent from 43.87 per cent.
The shareholding of financial institutions, mutual funds, banks and government of Kerala would come down to 19.58 per cent from 23.01 per cent while that of the public and others would come down to 28.19 per cent from 33.12 per cent.
Michelin will float a new joint venture company to import, manufacture, sell and market truck and bus radials with the dual brand of Michelin and Apollo, he said.
The official said two directors on behalf of Michelin would be inducted on the board of ATL and in the new company; Michelin will have four nominees against Apollo's three.