TOKYO, Dec 26 (Reuters) - Japan's third-largest tyremaker, Sumitomo Rubber Industries Ltd, will absorb two subsidiaries, Ohtsu Tire and Rubber Co Ltd and Dunlop Japan Ltd, as early as next July, a newspaper reported on Thursday.
The move, which will make Sumitomo Rubber the nation's second-largest tyre manufacturer, is aimed at boosting the competitiveness of the firm's group operations, the Nihon Keizai Shimbun said in its evening edition.
Sumitomo Rubber, owned 10 percent by U.S.-based Goodyear Tire & Rubber Co , currently holds a 51 percent stake in Ohtsu, Japan's fifth-largest tyremaker.
The absorption of the two units by Sumitomo Rubber will knock Yokohama Rubber Co Ltd back to third-largest tyremaker. Bridgestone Corp is the nation's largest player.
A Sumitomo Rubber spokesman declined to comment on the report. He said the company will discuss its reorganisation plan at a press conference at 3 p.m. (0600 GMT)
In August, Sumitomo Rubber said that it returned to the black in the first half of 2002 thanks to strong exports to the United States, a weak yen, and cost-cutting efforts.
Trading in shares in Sumitomo Rubber and Ohtsu were halted by the Tokyo Stock Exchange following the media report.
Sumitomo was up 2.5 percent at 492 yen, while Ohtsu was up 7.73 percent at 195 yen. Dunlop Japan is unlisted.