Apollo Tyres - A bold move would be an understatement - Kotak

Apollo Tyres has entered into a definitive agreement to acquire 100% equity of Cooper Tires for an equity valuation of US$2.2 bn, at 40% premium to Cooper's 30-day volume weighted average price, entirely financed by debt. Even as the deal is a very aggressive move by Apollo, it would make it the seventh largest tire company in the world.

As the size of the transaction is very large versus the current operations (Mcap. US$800 mn), it could swing either way for Apollo. We will review our rating and target price after a detailed discussion with the management.

Source : Equity Bulls

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