MILAN, April 15 (Reuters) - Curbs set by Italy's government to limit Chinese shareholder influence over Pirelli will allow the tyre maker to compete in the U.S. market, industry minister Adolfo Urso
Italy’s Restrictions on Chinese Stakeholders Let Pirelli Access US Market Fully
Italy’s Golden Power Rules and Their Impact on Pirelli
MILAN, April 15 (Reuters) - Curbs set by Italy's government to limit Chinese shareholder influence over Pirelli will allow the tyre maker to compete in the U.S. market, industry minister Adolfo Urso was quoted as saying on Wednesday by news agency ANSA.
Key Terms of the Restrictions
Among terms set last week by Rome under golden power rules designed to protect the national interest in corporate matters, Pirelli's largest investor Sinochem is entitled to name only three representatives to the tyre maker's board.
Limitations on Board Representation
Board members appointed by Sinochem will also not be allowed to hold top corporate roles such as chairman or CEO.
Background and Market Implications
The government ruling came at the height of a governance spat, with Italian investors and Pirelli itself claiming that Sinochem's ownership position was jeopardising the group's potential to expand in the U.S., where authorities are implementing new rules to cut the use of Chinese technologies in the automotive sector.
Statements from Industry Minister Adolfo Urso
"What is important for all Pirelli shareholders, for Pirelli employees and for the company is that they could maintain their initiative in the most promising market, that of the United States, and thus compete effectively with a cutting-edge technology in the global market," Urso said during an event in Rome.
Pirelli’s Market Position and Product Innovation
Pirelli specialises in the premium segment of the market and, among its products, sells so-called cyber tyres, which incorporate sensors allowing for the collection of data whilst the vehicle is in motion.
Company Response
The company declined to comment on Urso's remarks.
Reactions from Sinochem and Other Stakeholders
Earlier this week Chinese state-owned Sinochem said it might lodge a legal appeal against curbs set by Italy's government.
Sinochem’s Stake and Camfin’s Plans
Sinochem, which produces and trades chemicals and fertilisers, is Pirelli's largest shareholder with a 34% stake. Camfin, the vehicle of Italian businessman Marco Tronchetti Provera, holds around 26%, with plans to increase it to 29.9%.
Reporting Credits
(Reporting by Giulio PiovaccariEditing by Keith Weir)
