Aeolus Tyre Co. (600469.SS) recently announced plans to acquire a 90% stake in Prometeon Tyre Group S.r.l., an industrial tyre manufacturer headquartered in Italy, and 100% of domestic tyre manufacturer Guilin Beili Tyre Co., as reported by Jrj.com.
The company also plans to acquire the two target company’s land and real estate properties related to their industrial tyre businesses.
The total transaction amount will be RMB 5.783 billion which Aeolus Tyre will pay through issuing shares.
Why It Matters:
- Aeolus Tyre also plans to raise another RMB 2.021 billion. The money will be used for expansion in the international markets, building a tyre research center, improving product quality, and developing a digital system for the two acquired companies’ industrial tyre businesses.
- Prometeon Tyre Group S.r.l., a unit under Pirelli & C. SpA, manufactures truck, bus, agro, and OTR tyres under the Pirelli brand. Before the transaction, Aeolus already owned a 10% stake in Prometeon Tyre Group; therefore, after the transaction, Aeolus Tyre will own 100% of the company.
- After the transactions are finalized, Aeolus will become the largest industrial tyre manufacturer in China and the fourth largest on the globe.