Yokohama Rubber Co. Ltd. and Itochu Corp. will jointly establish a company that manufactures and sells tires in Russia.
Under terms of the agreement, the new company will be called Yokohama R.P.Z. LLC. It will be capitalized at 3.76 billion ruble (approximately 11.7 billion yen, or $124 million).
Yokohama will own 80% of the joint venture, while Itochu will own 20%
The companies say the new plant will have an annual production capacity of 1.4 million passenger tires and cost 4.8 billion ruble (approximately 14.8 billion yen, or $157 million) to build.
The plant will be constructed in the special economic zone (SEZ) in the state of Lipetsk, located some 311 miles south of Moscow.
Yokohama says it plans to begin constructing the plant in March 2010. The completion date is scheduled for September 2011.
The companies also agreed to increase Itochu's investment ratio in Yokohama Russia LLC, a tire sales company jointly established by the two companies in April 2005 in Moscow, from 14.9% to 20%.
