Organi Group acquires 50% of Rolling Plus to advance EUR 1 bn tire factory project

Organi Group wants to restart Rolling Plus’ tire factory project: Organi Group acquired 50% of Rolling Plus Chemical Industries to revive its EUR 1 bn tire factory project in the Suez Canal Economic Zone (SCZone) in partnership with Concrete Plus — which previously held a 70% stake in the company — an unnamed official told Asharq Business.

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The why: Rolling Plus — a joint project between Concrete Plus and Gulf investors — signed a contract in September 2023 to establish a EUR 1 bn tire factory in the Ain Sokhna Industrial Zone to produce some 7 mn tires annually. Limited progress on implementation in the years since prompted the company to reach an agreement with Organi Group earlier this year to contribute half of Rolling Plus’ capital, according to the source.

The details: The project is expected to be rolled out in three phases, beginning with a EUR 400-450 mn initial investment that will see the factory produce 3 mn tires annually. The second phase is expected to expand production, while the third will push output to 7 mn, adding heavy-duty tires. Half of the factory’s production has been earmarked for export.

REMEMBER- Organi Group plans to invest USD 1 bn in the automotive and tourism sectors over the coming five years.

Not the only local tire project in the cards: An unnamed Chinese company is reportedly looking to set up a USD 360 mn tire factory in the SCZone in partnership with the state-owned Arab Organization for Industrialization. Meanwhile, the government’s attempt to revive and develop state-owned tire manufacturer Trenco seems to be bearing fruit with an agreement to develop Trenco’s Alexandria-based factory with unnamed European companies and an agreement to establish a new Trenco tire factory with a Chinese company in Alexandria’s Amreya.

** Read more about our fledgling domestic tire industry — and the challenges it’s facing — in this Inside Industry two-parter we published in 2023 (Part I | Part II).

MORE PROJECTS COMING TO QANTARA WEST-

Two textile projects worth USD 28 mn are in the works: The Qantara West Industrial Zone will welcome two new textile projects with combined investments of USD 28 mn following agreements with the Suez Canal Economic Zone (SCZone), according to a statement. The new projects are set to export all of their output and generate a total of 800 jobs.

The details:China’s Changzhou Kingcason Printing & Dyeing will set up a USD 24.5 mn yarn manufacturing, dyeing, and printing facility that’s set to provide some 500 jobs. Meanwhile, Shanghai Honour and its UAE-based subsidiary Home Hub Textile will establish a USD 3.5 mn home textiles project, generating 300 jobs.

Big plans for Qantara West: With the latest two projects included, the SCZone has finalized 14 contracts in the Qantara West Industrial Zone, attracting USD 542.3 mn in investments within a 20-month period, according to the statement.