China National Chemical Corporation subsidiary China National Tire and Rubber Company (CNTR) is purchasing Italian tire producer Pirelli following acquisition talks for the stake of Camfin. Camfin is currently Pirelli's largest shareholder.
CNTR is set to purchase 26.2 percent of Camfin's stake in Pirelli, valuing the Italian tire producer at $7.7 billion, according to the New York Times.
"We are delighted with the opportunity to team up with Mr. Marco Tronchetti Provera and his team to continue to build together a world-class organization and a market leader in the global tire industry," China National Chemical Corporation chairman Ren Jianxin said in a statement, according to the newspaper.
Camfin investors will own up to 49.9 percent of the new company's capital. Last Friday, the company confirmed that it was negotiating with an "international industrial partner" for its ownership over Pirelli.
CNTR is expected to select new leadership for the board of Pirelli and is likely to reorganize the company. The company's "approach to business and strategic vision guarantee Pirelli's development and stability," Tronchetti Provera also said.
Overall, the deal is expected to double the tire company's business.
The CNTR was founded in 2004 and specializes in agrochemicals, rubber products and chemical materials.
