Michelin May Still Be Interested in Conti
Michelin joint-head Michel Rollier, may have said that the company is facing market challenges head-on by cutting capital expenditure to 700 million euros, but that doesn’t mean it has ruled itself out of buying economically priced competitors. Speaking at a press conference on Friday 13 February, Rollier said the French tyre manufacturer would consider Continental AG again, if the company ever comes back on the market. Coming just days after Continental AG’s major shareholder appealed for investors and state support, commentators are speculating that Michelin has an acquisition strategy.
Asked what Michelin would do if Schaeffler were to look for a buyer for Continental, Rollier told journalists: “Obviously Michelin wouldn’t be absent. I can’t tell you more than that.” Rollier’s interest appears to stretch beyond Continental alone to any other strategic advantageous tyre marker: “There are many smaller tyre companies in the world, and it’s not impossible that the crisis can lead to mergers. Here too, we certainly won’t absent.”
In September 2008 Michelin played down news reports suggesting it would acquire Continental’s tyre unit, should the division be for sale. At the time German magazine WirtschaftsWoche, reported that Michelin would give Continental’s truck tyre unit “a great deal of attention, even though there might be cartel related problems.”
The basis for Michelin’s coyness was the fact the Continental/Schaeffler deal was at that point some way from being completed. Talk of spinning off the rubber group was even more theoretical. Nevertheless, Reuters reported that – at the time- Michel Rollier said: “The opportunity has not presented it self until now and it would not be a surprise if the Continental tyre business remains a core part of the Conti group.” Now the rubber group is being carved out into a legally separate entity, it puts a whole different spin on Rollier’s comments.