Pirelli in risky situation without a deal with Sinochem, CEO tells Corriere
MILAN (Reuters) -Italian tyre maker Pirelli is in a risky situation after its Chinese leading shareholder Sinochem rejected a proposal by the company to solve governance issues that could hinder its expansion in the United States, the group's CEO told daily Corriere della Sera on Saturday.
Pirelli and its second-largest shareholder, Italy's Camfin, have said Sinochem's shareholding was posing risks to the tyre maker's ambitions to expand in the U.S., where some lawmakers are opposed to approving projects backed by Chinese companies.
The company had put forward a proposal to solve these governance issues, without releasing details on it, but earlier this month Pirelli's Chinese shareholder firmly rejected it.
"The goal is to find solutions that can guarantee Pirelli to operate in all markets of the world, particularly the U.S., without constraints and restrictions, thinking only of the company's industrial development," Pirelli CEO Andrea Casaluci said in an interview published on Saturday.
Pirelli makes over 20% of its revenue in North America and the percentage is 40% for sales of high-value products.
"Without a solution, the development of Pirelli's relevant technologies would be compromised and consequently future growth would also be at great risk, in all markets and especially in Italy," Casaluci said, adding that the group plans to expand its research and development activities in its home country.
Casaluci also said that Sinochem has presented its own proposal on the governance to the Italian government - which has so-called golden powers to block or limit foreign influence on domestic groups considered strategic - without consulting with the group.
Contacted by Reuters Pirelli and Sinochem were not immediately available to comment the interview.
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