Onyx Group, a conglomerate company based in the United Arab Emirates, is expanding into the tyre sector through a partnership with Italy-based global tyre company Marangoni Group on industrial tyres.
With activities spanning across a spectrum of industries such as construction, manufacturing, real estate, industrial catering and hospitality, Onyx Group has now set its sight on becoming Sri Lanka’s largest tyre manufacturer, serving both the local and international markets.
The initial step in 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.
The licensed technology from Marangoni will be equipped in a new tyre plant in Horana, Sri Lanka. Nandana Lokuwithana, Onyx Group Chairman who invested in the tyre plant, said they have already begun construction of the facility and expects it to 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,”Lokuwithana added.
For the solid tyre business, a roadmap has been agreed in the partnership. According to the signed memorandum of understanding (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, Italy.
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 EUR30 million, and 7,000 tonnes is the yearly production of the plants in Italy and in Sri Lanka.
One-third of the tyres are delivered to various original equipment manufacturers (OEMs) 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 TyresS.r.l., a company to be incorporated in Italy
“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,” said Vittorio Marangoni, Marangoni Group President.