CEAT OHT Lanka (Private) Limited has formalized a $171 million investment agreement with the Board of Investment of Sri Lanka (BOI), marking one of the largest recent investments by an Indian company in Sri Lanka’s manufacturing sector.
The agreement follows CEAT Limited’s acquisition of Michelin Group’s Construction Compact Line Business, which includes the Midigama plant and the Casting Product plant in Kotugoda, Sri Lanka. The transaction grants CEAT global ownership of the Camso brand, which will be fully integrated across product categories after a three-year licensing period. The closing process for the acquisition is currently underway.
The investment is aimed at expanding manufacturing capacity for Off-Highway Tyres (OHT) and tracks at the Midigama and Kotugoda facilities. These units will focus on export-oriented production, particularly for compact construction equipment, reinforcing Sri Lanka’s position as a hub for high-value, export-led manufacturing.
A tripartite Memorandum of Understanding (MoU) has been signed between CEAT OHT Lanka, Michelin Lanka, and the Inter-Company Employees Union (ICEU) to ensure job security for approximately 1,483 employees. The MoU guarantees continuity of employment, including preservation of seniority, salaries, benefits, and past service, with no retrenchments planned during or after the transition.
Arjuna Herath, Chairman of the BOI, stated that the investment reflects growing confidence in Sri Lanka’s industrial and export capabilities. “This approval underscores our support for strategic partnerships that contribute to sustainable economic development and position Sri Lanka as a competitive destination for foreign investment,” he said.
Amit Tolani, Chief Executive of CEAT Specialty, emphasized the strategic importance of the investment. “This agreement marks a significant milestone in our long-term engagement with Sri Lanka. We are committed to scaling up our off-highway tyre operations and leveraging the country’s manufacturing strengths for global markets.”
Kumar Subbiah, Chief Financial Officer of CEAT Limited, highlighted the focus on operational continuity and workforce stability. “Ensuring a smooth transition while maintaining employee welfare is our immediate priority. This investment reflects our confidence in Sri Lanka’s potential as a center for world-class OHT manufacturing.”
CEAT, part of the RPG Group, is among India’s leading tyre manufacturers, serving original equipment manufacturers and aftermarket customers across more than 110 countries. The company has previously been recognized with the Deming Grand Prize for excellence in Total Quality Management and holds a ‘Lighthouse Designation’ from the World Economic Forum for its adoption of Industry 4.0 technologies.
With this development, CEAT reinforces its global footprint in the off-highway tyre and tracks segment, while positioning Sri Lanka as a key node in its international manufacturing and export strategy.