Michelin is entering into a partnership with Swedish firm Scandinavian Enviro Systems (Enviro) to develop and industrialise on a large scale pyrolysis technology to recycle end of life tyres into raw materials. The two companies signed a shareholding subscription today that will see a subsidiary of the tyre maker, Michelin Ventures SAS, acquire a 20 per cent stake in Enviro.
Braking systems company Brembo S.p.A. has announced that it holds an interest in consumer tyre manufacturer and fellow Formula 1 supplier Pirelli. As of 31 March 2020, Brembo holds a 2.43 per cent stake in Pirelli, both directly and through its parent company Nuova FourB.
Private equity firm Warburg Pincus is investing around £117 million in Apollo Tyres via a subsidiary. On 26 February, the tyre maker’s Board of Directors approved the issue of up to 108 million compulsorily convertible preference shares, each with a face value of Rs 100, to Emerald Sage Investment Ltd. The transaction is subject to shareholder and regulatory approvals.
In June and July, J.K. Organisation company JK Credit & Finance acquired 50.003 per cent equity shares in Indian start-up Treel Mobility Solutions Pvt. Ltd. JK Tyre & Industries has now obtained 26 per cent equity in the smart tyre system specialist from its group sibling and rebranded Treel as a ‘JK Tyre Product’. JK Tyre paid Rs 59.8 million for its 26 per cent share in Treel; JK Credit & Finance continues to hold 24.003 per cent in the company.
Through a new arrangement with Mitsubishi Corporation (Mitsubishi), Toyo Tire & Rubber (Toyo) aims to “survive and remain viable” during the “unprecedented transformation” currently occurring in the automotive industry. The two parties have entered into a business alliance agreement that involves Mitsubishi increasing its shareholding in Toyo from 3.05 per cent to 20 per cent. Toyo will issue Mitsubishi 26,931,956 new shares via a third-party allotment that will be paid in between 15 January and 28 June 2019. With this share acquisition, Mitsubishi becomes Toyo’s largest shareholder.
It won’t be a Good Friday for Kumho Tire if an agreement between its creditors and the labour union representing its workforce isn’t reached by the end of this week. Friday 30 March is the deadline set for a formal consensus regarding the sale of a 45 per cent share in the tyre maker to China’s Qingdao Doublestar Tire for KRW 646.3 billion (£421.7 million).
The Michelin Group has purchased a 20 per cent share in German automotive services provider A.T.U. (Auto-Teile-Unger). The minority stake was acquired from French automotive maintenance and repair services group Mobivia Groupe for 60 million euros; following the acquisition, Mobivia and Michelin intend to combine their expertise in order to further develop A.T.U. in Germany, Austria and Switzerland.
Creditors holding a 42.01 per cent share in Kumho Tire are going to look for a new owner – again. Some four months after Qingdao Doublestar Tire’s planned acquisition of the South Korean tyre maker collapsed, the Korea Development Bank (KDB) and the other creditors are said to be once more looking for an external investor.
Acting in concert with Ivory Coast-based company SIFCA, Michelin has opened a simplified cash public tender offer through its 99.99 per cent-owned subsidiary Compagnie Financière Michelin SCmA (CFM) to acquire the 841,285 shares in natural rubber company Société Internationale de Plantations d’Hévéas (SIPH) not currently held by the two parties. Michelin states that it and SIFCA will pay 85 euros for each share in the West Africa-based rubber producer and marketer.
The latest development in the negotiations to sell a stake in Kumho Tire is that potential buyer Qingdao Doublestar Tire probably won’t, after handing over KRW 955 billion (£653.6 million) for the 42.01 per cent controlling share, be permitted to use the Kumho name.
Halfords has acquired a minority stake in TyresOnTheDrive.com valued at up to £8 million and simultaneously entered into an operating agreement with the mobile tyre fitting business. The shareholding was purchased during a round of investment in Tyres on the Drive in which existing shareholders MMC Ventures and True Capital also participated.
Speculation is rife in South Korea regarding who’ll acquire the 42.1 per cent shareholding in Kumho Tire that is currently up for sale. Pirelli parent company ChemChina has already been named as a prospective buyer, as have Continental and Michelin. One tyre company can, however, be ruled out as a new Kumho Tire shareholder.
Marco Tronchetti Provera does not expect Western Sanctions against Russia to have any impact on Rosneft’s acquisition of a 13 per cent shareholding in Pirelli. Reuters reports that the Pirelli chairman and CEO told journalists on the sideline of an event that “the timetable of the deal is confirmed, nothing has changed.”
Pirelli’s share in Italian real estate company Prelios has risen from 13 per cent to approximately 29 per cent following the conversion of bonds worth €148.4 million plus accrued interest. While this 29 per cent shareholding includes a portion (around 22 per cent) that is constrained by lock-up obligations until 2016, Pirelli has released a statement confirming its strategic focus upon its core tyre business. The company is “therefore not a long-term investor in the ‘real estate’ industry” and will “seize any possible opportunity” to divest its Prelios shares.
Working on a share price of €12, which translates into a market capitalisation of €5.8 billion, Pirelli boss Marco Tronchetti Provera has arranged the sale of 13 per cent of all Pirelli shares to a majority state-owned Russian energy giant. With this transaction, Rosneft is set to become the largest single Pirelli shareholder. But even though his own shareholding will reduce to less than five per cent when the ink dries on the deal, Tronchetti will retain more or less free rein at Pirelli. While some market observers currently fear that the political situation in Crimea and the Ukraine may harm the deal, and others set their hopes upon the introduction of sanctions against Russia getting in the way, this article focuses on other questions – who Pirelli actually belongs to, who has the say at Pirelli, and how it is possible to control the Pirelli Group despite only having a minority shareholding?