Servis Industries Limited (SIL) has entered into a Joint Venture Agreement with Chaoyang Long March Tire Company of China and Myco Corporation of Pakistan for setting up a Greenfield project. This was informed in a notification sent to Pakistan Stock Exchange (PSX).
The project will embark on manufacturing and sale of radial tires for trucks and buses to meet the progressive demand of local market as well as its export to other countries. According to the notification issued by the company, the equity stake of parties in the Joint Venture Company will be as follows:
- Service Industries Limited – 51% (with or without collaboration of associates/others)
- Long March Tyre Company – minimum 44% (maximum 49%)
- Myco Corporation – maximum 5% (any shortfall will be contributed by Long March Tyre Company)
The Joint Venture will be incorporated under the name of ‘Service Long March Tires (Private) Limited’. Furthermore, the Board resolved to make long term equity investment of up to USD $30.6 million in equivalent Pakistani Rupees in the above mentioned Joint Venture Company, from time to time within a period of 3 years.