CEAT shares rallies over 12 pc after tyre maker acquires Camso for Rs 1,905 crore

Shares of tyre maker CEAT rallied more than 12 per cent on Monday after the RPG Group company said it has entered into a definitive agreement with Michelin to acquire its Camso brand's Off-highway Tyres (OHT) and tracks business for about USD 225 million (Rs 1,905 crore).

The shares of the company climbed 9.64 per cent to Rs 3,390.15 apiece on the BSE.

During the intraday trade, CEAT's shares advanced 12.10 per cent to hit 52-week high of Rs 3,466.40 per piece on the bourse.

On the NSE, it jumped 10.77 per cent to Rs 3,429.05 apiece. Later, it bounced 12.06 per cent to hit its 52-week high of Rs 3,469 apiece on the exchange.

The market capitalisation of CEAT jumped Rs 151.41 crore to Rs 1,402.16 crore on the BSE.

The 30-share BSE Sensex rose 14.45 points or 0.02 per cent to trade 81,723.57. However NSE Nifty slipped 6.15 points or 0.02 per cent to 24,671.65. On Friday, CEAT said it has entered into a definitive agreement with Michelin to acquire its Camso brand's off-highway tyres (OHT) and tracks business for about USD 225 million (Rs 1,905 crore).

The acquisition is significant for CEAT in its ambition to become a leading global player in the high-margin OHT segment, as it will give the company access to a global customer base, including over 40 international OEMs and premium international OHT distributors, the company said.

Camso is a premium brand in construction equipment tyres and tracks with strong equity and market position in the EU and North American aftermarket and OE segments.

"The track segment is growing faster and (also) has a larger premium play with the customers yet to figure out the right applications of tracks in construction and mining, which means there is a lot of scope for higher penetration in the track segment. So, between the two, tyres and tracks, the latter is more attractive, where CEAT will focus on growth," CEAT Managing Director and CEO Arnab Banerjee told PTI in an interaction.