Michelin selling stake in Double Coin joint venture

Paris – Groupe Michelin is selling its 40% stake in the Double Coin (Anhui) Warrior Tire Co. Ltd joint venture to affiliates of the venture's majority partner, Shanghai Huayi (Group) Co. Ltd, including Double Coin Tire Group Co. Ltd.

The venture partners – which created the 60/40 venture in 2011 – did not disclose the value of the transaction. At the time of the venture's formation, Michelin's capital investment was valued CNY 667 million (approximately €75 million).

For the record, Compagnie Financière Michelin and Michelin (China) Investment Co. Ltd are transferring Michelin's ownership stake to Huayi Group (Hong Kong) Co. Ltd. (30%) and Double Coin Tire Group (10%).

Double Coin (Anhui) Warrior Tire is a Wuwei, China-based company producing passenger and light truck tires under the Warrior and other brand names. The plant was built at a cost of nearly €390 million, with annual capacity of 15 million car and light truck tires.

During the intervening six years, Michelin said it has "continuously supported the development, the quality management and the commercial performance of the [joint venture] to help the Warrior brand to improve competitiveness in the market."

In a statement released by Michelin, the parties said: "In order to better focus on all parties' core strengths and to continue to strengthen their respective brands and to better focus on their respective strategy, all the parties have decided to make this equity transfer. All parties agree that the transaction is in their best interests and is beneficial to the sustainable growth of Michelin, Double Coin and Warrior."

Michelin continues to operate in China through two other subsidiaries: Michelin Shen Yang Tire Co. Ltd. in Shenyang, Liaoning Province (producing consumer and commercial tires); and Shanghai Michelin Tire Co. Ltd. in Tsen Tai, Shanghai (producing consumer tires).

Looking ahead, Michelin said it remains optimistic about China's long-term growth and is committed to the sustainable development of transportation in China.

Double Coin's US subsidiary China Manufacturers Alliance LLC disclosed plans in 2013 to launch Warrior-brand passenger tire sales in North America, but the plans were scuppered a few months thereafter when the US government voted to impose elevated import duties on Chinese passenger tires.

Double Coin still maintains a website dedicated to the brand.