MILAN, June 30 - Italian tyre manufacturer Pirelli has informed its new board of a proposed multi-year investment package for the United States totaling approximately $1.0 billion to $1.2 billion, aimed at expanding production capacity in the country. The company said the plan, which includes capacity for its so-called Cyber Tyres, will be put forward for formal approval at an upcoming meeting.
Pirelli has already indicated plans to begin producing Cyber Tyres at its U.S. plant in Rome, Georgia.
The public announcement of the investment plan followed interventions by the Italian government designed to limit the powers of Pirelli's Chinese investor Sinochem, citing the risks those powers posed to the premium tyre maker's business ambitions in the United States. Those interventions were reflected in recent shareholder actions that led to a reconstituted board.
Cyber Tyre technology integrates sensors embedded within the tyre structure with software that can transmit real-time data to vehicles. Pirelli named this technology explicitly among the items covered by the planned U.S. investments.
As part of the limitations imposed by the Italian government, shareholders last week appointed a new board that is largely controlled by Italy's Camfin, the investment vehicle associated with Marco Tronchetti Provera. Camfin holds a 26.2% stake in Pirelli.
Sinochem, which retains a 34.1% stake in the group, managed to secure election of three directors to the 15-member Pirelli board.
At the same board meeting the company confirmed Andrea Casaluci in the chief executive officer role, and appointed Marco Tronchetti Provera as executive chairman after he served as executive vice chairman for the past three years.
The company also included a brief investor-oriented note concerning its ticker PIRC, asking whether the stock represented value and noting a valuation tool that uses a mix of 17 industry valuation models to assess fair value. That material invited readers to evaluate PIRC alongside other stocks.
Context and next steps
The investment plan must receive formal approval at a forthcoming meeting of the board and stakeholders. Implementation details such as timing, plant-specific ramp schedules and allocation of the $1.0 billion to $1.2 billion envelope were not disclosed in the announcement shared with the board.