From ailing Apollo Tyres to Cooper aquizition: The journey of Onkar Kanwar

By Prince Thomas

It was in the 1980s that Onkar Kanwar got a chance to study Cooper Tire & Rubber Co, an American tyre major. Kanwar’s Apollo Tyres had a technical collaboration with General Tire International Co and in every visit to the US, the Indian businessman would hear about Cooper Tire. “They were making a lot of money. Coming back to India, I would tell my people to study this company,” recounts Kanwar of the times when Apollo was still a fledgling company, having just escaped closure in the previous decade.

More than 30 years on, it has been a dream come true for the now veteran businessman. Last week Apollo Tyres announced its proposal to acquire Cooper Tires for $2.5 billion, one of the biggest acquisition in the Indian auto sector. The deal catapults Apollo onto the top 10 list of global tyre makers list at number 7. For Kanwar personally, the multi-billion dollar acquisition gives him a front seat among leading Indian entrepreneurs. When the Forbes India Rich List for 2013 come out later this year, he will surely improve upon his 99th position debut in last year’s edition.

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Not many had bet on Kanwar when he took over the ailing tyre company from his father Raunaq Singh in 1979. As he hold my colleague Ashish Kumar Mishra in Forbes India’s Fourth Anniversary Special Edition, he still remembers the laughter of his employees when presented with his ambitious plan to turn around the company. More questions were asked when he chose to “fight” his father in Apollo’s boardroom, eventually leading to a divide in the family.

It is easy to see that Kanwar has conviction in his decisions. That belief carried him through the tough times and decisions - from engaging with unions in his Kerala plant to starting on a globalisation drive when almost everyone else was concentrating on a fast growing Indian market. As his son Neeraj, also the Managing Director and Vice Chairman of Apollo Tyres, told journalists last week, it was an obvious decision. ‘We needed to de-risk our business and find new markets. Second, developed markets come with better technology and higher margins," he said.

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When Forbes India talked to the father-son duo last year, they had set themselves a five-year target - revenues of $5 billion and rank among the top 10 tyre makers in the world. Kanwar credits his son for achieving it much before the deadline they had set for themselves. After the Cooper deal, Apollo’s topline would be $6.6 billion. “Watch out for him. He also has the fire in the belly like I had in my younger days,” says the indulgent father.

From the 1980s, it is clear that Cooper Tires was always a part of Kanwar’s plan for Apollo’s future. He had become close friends with Copper Tires Chairman Roy Armes. The two men have been exploring partnership possibilities for almost five years. In fact, this was not the first time that Apollo had offered to acquire Cooper Tires. Autonews.com quotes Armes from an interview with Tires Business, “Apollo approached us last year with an offer that we determined wasn’t in our best interest, so we walked away from it.”

While industry analysts might not be convinced with the price, Kanwar strongly believes that the deal was right for the company. He is already looking forward and will be immersing himself in the post-acquisition integration between the two companies. And as Kanwar flies to the US this week to start meetings to compete the transaction, it is like life has now come a full circle