ChemChina is the new biggest shareholder at Pirelli Spa’s
The company’s biggest shareholder agreed to sell its stake to ChemChina in a deal that will lead to a takeover bid valuing the Italian tire maker at about EUR 7.1bn. Accordingly, the state-owned ChemChina will pay € 15 for each share of the 26.2% stake in Pirelli owned by Cam Finanziara Spa (Camfin). ChemChina will then make a public tender offer for the rest of the tire maker at the same price.
Pirelli is presently considered as an investment grade company (not rated but it is associated to a BBB- rating). Since the take-over discussions became public last week, the prices for the outstanding bonds corrected by about 3 %, representing the lower credit quality of the new owner.