Marangoni and Onyx expanding their cooperation
Marangoni Group and Onyx Group, through its subsidiary Ceylon Steel Corporation (CSCL), signed a binding Memorandum of Understanding on Industrial Tyres.
This is a further step in the strategy of Onyx Group to invest in the tyre sector, with the objective of becoming the largest tyre manufactures in Sri Lanka and serving both local and international markets.
The first move of this strategy has been made in the car radial sector through the acquisition of the process and technology know-how and a state-of-the-art European quality standard production line from Marangoni Meccanica, a subsidiary of Marangoni Group.
For the solid tyre business, a roadmap has been agreed in the MoU. According to the MoU, Onyx Group is going to buy 49% of shares of Marangoni lndustrial Tyres Lanka (Private) Limited, a company incorporated in Sri Lanka, and to sign an Off-Take agreement whereby Marangoni will continue to manufacture the actual range of solid tyres for the Onyx Group in its plant in Rovereto.
The Marangoni Industrial Tyres Business Unit has companies in Sri Lanka, Germany, France and Italy and sales in 40 countries across the world, with a 15% market share in Europe. The corporate brand and the trademarks registered under Marangoni’s solid tyre business (like Jumbo, Forza, Eltor, Quickmont) are positioned in the premium segment.
Its worldwide revenues exceed 30 m euros and 7,000 tons is the yearly production of the plants in Italy and in Sri Lanka.
One-third of the tyres are delivered to various OEM Manufacturers and two-thirds to the customers in the Replacement market.
The next steps of the roadmap for solid tyres will include the following European commercial entities in the perimeter of the deal:
– Marangoni lndustrie Manutention, a company incorporated in France
– Wenzel lndustrie GmbH, a company incorporated in Germany
– Marangoni Industrial Tyres S.r.l., a company to be incorporated in Italy
The Onyx Group Chairman, Mr. Nandana Lokuwithana, said: “In Horana, we have already started construction and it will be completed in 16 months. Thanks to the support provided by Marangoni, next we will install machinery and then the first car tyre manufactured in Horana will be ready by the third quarter of next year. It is an initiative with far-reaching benefits for Sri Lanka and certainly can roll out many a profiting mile. We will also use as much local raw material which in turn will help to increase price for local rubber industry.”
“This agreement is consistent with the new strategy of focusing our Group on the core markets and businesses of retread, machinery and compounds while developing sound long-term partnerships for technology, production and sales,” is the comment of the Marangoni Group President, Mr. Vittorio Marangoni.
Marangoni Group had 342 m euros revenues in 2015 and 1,500 employees in the world. After seventy years of activity in the tyre business, Marangoni is today a worldwide recognised leader in the sector of retreading systems, design and manufacture of machinery for the tyre industry, production of industrial tyres and of technical compounds.
Onyx Group is a conglomerate company based in United Arab Emirates with activities spanning across a spectrum of industries such as construction, manufacturing, real estate, industrial catering and hospitality. Ceylon Steel Corporation, the largest steel manufacture in Sri Lanka, Marriott Hotel and Marriott Executive Apartments, Al Jaddaf Dubai, Onyx Industries and Onyx Building Systems are among the businesses owned by the group with nearly 2,000 full time employees working for the group.