Chinese chemical company ChemChina has acquired Italian tire company Pirelli for $7.7 bn.
ChemChina makes all steel radial tires and off-the-road tires, and is reportedly one of the largest producers of high strength conveyor belt and auto brake hose in China.
The deal is expected to give ChemChina access to technology used by Pirelli for manufacturing premium tires, and Pirelli is expected to gain larger presence in the Chinese market after the deal is completed.
China National Tire & Rubber, the tire-making unit of ChemChina's will first buy the 26.2% shares of Pirelli from Camfin, and later on a mandatory takeover bid for the rest of the shares will be done.
Pirelli CEO Marco Tronchetti Provera said: "The partnership with a global player like ChemChina, through its affiliates, represents a great opportunity for Pirelli.
"CNRC's approach to business and strategic vision guarantee Pirelli's development and stability."
