In the early hours of 23 March 2015 Beijing Time, ChemChina’s China National Tire & Rubber Co. (CNRC) subsidiary signed an agreement with Camfin S.p.A. to purchase Camfin’s 26.2 per cent Pirelli shareholding at 15 euros a share. This values Pirelli at around 7.1 billion euros (£5.15 billion pounds). A joint tender offer by ChemChina, Camfin and other investors on the rest of Pirelli’s shareholding is now expected to follow.
With ChemChina in talks to buy Pirelli, Tyres & Accessories presents a brief introduction to the Chinese firm
The China National Chemical Corporation (otherwise known as ChemChina) is Chinese a state-owned chemical, rubber and tyre business. Established in May 2004, ChemChina is run under the administration of SASAC (the Chinese State-owned Assets Supervision and Administration Commission).
The first thing we have to consider is the size of the company. ChemChina is a Fortune 500 company and call itself China’s largest chemical company. Globally the firm places itself in 19th place.
News agencies are reporting China National Chemical Corporation, which names brands such as Aeolus amongst its number, is close to purchasing shares in Camfin, which own 26 per cent of Pirelli and would give ChemChina a controlling shareholding in Pirelli. For the last year or so Camfin has been owned by Russian oil firm Rosneft and a holding company of Pirelli’s chairman and chief executive, Marco Tronchetti Provera. Other significant shareholders include Italian banks Intesa Sanpaolo and UniCredit.
State-owned China National Chemical Corp (ChemChina) said in its first Sustanability Report that scientific development will be the main focus of its next five-year plan (2012-2017). During 2006-2011, ChemChina put more than 12 billion yuan ($1900 million) into technology research, an annual increase of 14.5 percent. The company owns seven subsidiaries, including Aeolus Tyres, Guilin Rubber, Yiyang Rubber and the Xinghuo Organic Silicon Co, that are national technology centres.
Approximately £90 million is said to be earmarked for Qingdao Yellow Sea Rubber to assist it move production to a new facility. This money is to come from controlling company China National Chemical Corporation (ChemChina), and the move of production from its headquarters to an industrial park will allow an increase of all-steel radial capacity to 1.8 million units per annum in 2008, and when its semi-steel radial production moves later the overall annual capacity in the facility will be 3 million units. Additional all steel and semi-steel capacity will be added, with all construction expected to be completed by the end of next year.