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. Last Updated: 07/27/2016

Tire Maker Hits Brakes on JV

Domestic tire giant Amtel threatened on Wednesday to dump its joint-venture partner Nokian Renkaat and strike a production deal with Bridgestone, hinting at closer ties with the Japanese giant instead.

Amtel general director Alexei Gurin said a joint production agreement with Nokian expired earlier this month and the two companies had failed to agree on terms for extending their partnership.

"Relations with Nokian have been frozen since Jan. 1. All contacts may be broken in the near future depending on the situation," he said.

"In the next two or three months, Amtel will decide on a new partner, and that could be Bridgestone," Gurin added.

Finland's Nokian Renkaat, in which Bridgestone owns about 20 percent, said in a statement on Wednesday its 50-50 joint venture with Amtel was still intact.

Nokian shares sank 9.9 percent at 62 euros immediately after the news.

Amtel vice president Anatoly Volnov said earlier Wednesday that Amtel and Bridgestone planned to produce a quarter of a million tires this year under a Bridgestone brand at Amtel's Kirov plant.

Bridgestone neither confirmed nor denied it had done a deal with Amtel.

Amtel and Nokian had targeted production of 2 million tires this year, rising to 5 million tires per year by 2006.

Amtel is a major player in Russia with a 35 percent share of the car tire market.