Qingdao Doublestar Joins in Merging with Kumho Tire

Qingdao Doublestar Co., Ltd. announced on Nov. 22 that it planned to join in the establishment of the M&A fund, seeking for M&A opportunities in overseas market.

At the beginning of the establishment of the fund, the company has had a clear target, namely Republic of Korea-based Kumho Tire.

Market information went that Samsung and a few of other buyers are intended to purchase the Korean company.

The M&A fund in which Doublestar participated names Qingdao Xingwei Equity Investment Fund Center at present.

The fund was jointly initiated and established by Qingdao Doublestar, Qingdao International Investment Co., Ltd., Qingdao Guotou Dehou Investment Management Co., Ltd. and Qingdao Conson Innovation Equity Investment Management Co., Ltd.

According to Qingdao Doublestar, the M&A fund adopts the model of limited partnership and the size of the fund will not exceed 10 billion yuan.

Qingdao Doublestar, Qingdao International Investment Co., Ltd., Qingdao Guotou Dehou Investment Management Co., Ltd. and Qingdao Conson Innovation Equity Investment Management Co., Ltd. expect to invest 900 million yuan, 395 million yuan, 50 million yuan, 5 million yuan and 5 million yuan in the fund.

The board of Qingdao Doublestar approved relevant proposals on Nov. 21.

The investment targets of the M&A fund are overseas tire, auto and relevant up- and down-stream industries and looking for M&A opportunities in those industries.

The creditor of Kumho Tire took this Nov. as the final month for accepting the acquisition letters of intent and schedules to initiate the bidding in next Jan.

Kumho Tire was the world's 10th largest tire producer, while Doublestar ranked the 34th.

But an industry insider analyzed that establishing a special fund at the beginning of the merger shows Doublestar is fully prepared.

The news that Kumho Tire is for sale has attracted global tire giants' interests.

Media reports said that about 10 companies have offered their bids.

ChemChina, Continental Corporation, Michelin, Bridgestone, India-based Apollo Tyres and Linglong Tire are within the potential buyers in the tire industry.