Pirelli Tyre S.p.A and Egypt’s Minister of Investment have signed a Memorandum of Understanding (MoU) to evaluate the possible expansion of the Alexandria Tyre Co. (Atco).

The Italian tyre giant has over 90% ownership of Atco, which produces radial truck tyres in Alexandria, Egypt.

The agreement was signed by Ashraf Salman, Egyptian Minister of Investment, and Alberto Pirelli, vice president Pirelli & C. S.p.A and head of Region Middle East, Africa and India for Pirelli Tyre S.p.A.

Atco is expected to invest around $107 million on expanding and upgrading the factory, over a 36-month period. When complete, the expansion will boost the factory’s production capacity by 300,000 radial truck tyres.

Pirelli became a major shareholder in Atco in 1999, and currently produces about 850,000 truck tyres a year in Egypt.