Pirelli pays Euro835.5 million to re-acquire Tyre stake
ERJ staff report (DS)
Milan, Italy -- Pirelli & C. SpA said it will re-acquire all the shares in Pirelli Tyre that it sold to a consortium of banks in August 2006. Pirelli will pay a total of 835.5 million euros in cash and debts to buy the stake. In July 2006, Pirelli said it was selling the stake for Euro 740 million.
The latest price values Pirelli's tyre operations at just under Euro 2150 million. Pirelli said the re-acquisition move is part of the Group's strategy to refocus on its core businesses announced following the sale of Olimpia. Ownership of the shares will transfer at the same time as the closing, expected later today, with the exception of a 19.19% stake, whose transfer to Pirelli is expected to occur in July 2008.
The banking consortium operates under the name of Speed SpA, a company held by primary financial institutions (Intesa Sanpaolo, Banca Leonardo Group, UniCredit, One Equity Partners -JP Morgan Group, Lehman Brothers and Mediobanca). Speed has held 38.9% of Pirelli Tyre SpA since August 2006. Pirelli is buying this stake -- the only asset of Speed, -- for a cash payment of 434.4 million euros financed by available liquidity. The full purchase consideration takes into account Speed debt of about 401.1 million euros.
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Press release from Pirelli
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