Ceat (500878) investor relations material

Deal rationale and strategic fit

• Acquisition provides global access to a premium brand and two manufacturing facilities in Sri Lanka, supporting premiumization, globalization, and high-margin specialty segment growth.

• Expands product base into construction tires and tracks, with access to 40+ global OEMs and 200+ premium distributors, enhancing off-highway mobility presence.

• Complements existing operations in Sri Lanka, leveraging 26 years of local experience and established regulatory, operational, and people knowledge.

• Integration of CAMSO's brand and manufacturing enhances product portfolio and market reach, especially in EU and North America.

• Acquisition aligns with the goal to become a global leader in Off-Highway mobility.

Financial terms and conditions

• Total deal value is $225 million, including physical assets, inventories, and intangibles like brand and patents.

• $138 million paid to date, with further payments for inventory over 12–18 months and $44 million for the brand after three years.

• Gross block of acquired assets is valued at $90–100 million, based on external valuation.

• US $171 million investment in Sri Lanka as part of the acquisition.

• Ownership of the CAMSO brand will be permanently assigned after a three-year licensing period.

Synergies and expected cost savings

• Significant upside in plant capacity utilization, currently at 50%, with potential for margin improvement as customer relationships transition.

• Addition of 1,500+ skilled workforce and integration of R&D and manufacturing teams.

• Combined strengths in products and capabilities expected to drive sustainable growth and portfolio expansion.