Jiaozuo, China – Aeolus has terminated the acquisition of a 90% stake in the former Pirelli industrial tire unit Prometeon Tyre Group (PTG), the Chinese company announced 4 Jan.
The planned deal, priced at €215 million (1.7 billion yuan), also included a 70% stake in Guilin Beili Tire, another subsidiary of Aeolus’ parent group ChemChina Rubber Corp.
The transaction’s earlier agreement stipulated that it would be automatically terminated on 31 Dec, 2017, if the deal had not received necessary regulatory approval from Chinese authorities.
Despite the obstacle, Marco Polo International Italy S.p.A.'s TP Industrial Holding said in a news release it was planning to pursue, in the commercial and technological areas, the integration of Prometeon Tyre Group.
Prometeon, which represents the commercial tire assets that were separated from Pirelli last year, said it will continue its integration "in an appropriate time frame in accordance with the laws and regulations."
Besides TP Industrial's 52-percent shareholding, Prometeon's other shareholders are Cinda International Holding (CINDA) — a Chinese investment fund — with 38 percent and Aeolus with 10 percent.
Prometeon said it will continue to grow its business and "commercial presence with its new go-to-market approach and commercial organisation."
Meanwhile, the planned deal between Aelos and Pirelli, priced at $275 million, also included a 70% stake in Guilin Beili Tire, another ChemChina subsidiary.
The transaction's earlier agreement stipulated it would be terminated automatically on Dec. 31 if the deal had not received necessary regulatory approval from Chinese authorities.
"ChemChina Rubber Corp. will reconsider injecting those industrial tire businesses and assets into Aeolus when the time is ripe," according to a subsequent announcement by Aeolus.
"Although the deal is terminated, our business integration is still in progress," the announcement added. "Aeolus will continue to benefit from our technology assistance agreement with Pirelli."
Aeolus' shares have resumed trading on the Shanghai Stock Exchange approval for overseas acquisition by China's Ministry of Commerce and The National Development and Reform Commission was not granted in time, said Aeolus’ announcement.
Tire Business, a US sister publication of ERJ contributed to this report.