CHENNAI, Dec 30: The fate of the Rs 400-crore American Trac Tyres project now seems uncertain with the Korean company Hanook Corporation which was supposed to pick up an 11 per cent equity stake pulling out of the project. With the market conditions also uncertain, the company has decided to put the project on hold presently and re-consider it when the market is more conducive.The project, which was jinxed right from the beginning, started off on a bad note when the land owners in the Kanya Kumari district in southern Tamil Nadu where the project was supposed to be located, moved the courts to stop the company from acquiring the land, in 1995. Later, Tamil Nadu Industrial Development Corporation (TIDCO), which also was to pick up a stake in the project, suggested re-location to Tirunelveli, identified the acreage and notified the company, way back in June 1997. But by then the project dynamics had changed and the company asked Tidco for time to re-evaluate the project. Meanwhile, Hanook had also been ropedin as a partner in the venture.
American Trac Tyres had plans to set up a plant with a capacity to roll out 1.5 million tyres annually.
But when the South Korean economy crashed, Hanook decided to pull out of the project and with the demand also being non-conducive to set up a tyre plant, the project has been put on hold for the present, sources at Hindustan Udyog Ltd, the Indian representatives of American Trac Tyres, said.
Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.
