Pirelli sidelines China’s Sinochem over control of the Italian tyremaker
The governance status of the Chinese conglomerate has been downgraded following a request from Italian regulators
Pirelli took a first step to distance itself from its main investor, declaring on Monday that China’s Sinochem no longer has control over the Italian tyremaker.
The company downgraded the governance status of the Chinese conglomerate following a request from Italian regulators. The board clashed over the decision, with five of the company’s Chinese directors opposing it and one abstaining, Pirelli said in a statement on Monday. The board comprises 15 members.
While the end of controlling status will not oblige Sinochem to sell its holding, it will effectively distance the company financially from Pirelli. The decision on Monday, previously reported by Bloomberg, follows years of wrangling over Pirelli, including moves by Italy’s government to curtail Sinochem’s influence.
Sinochem, which owns a 37 per cent stake in Pirelli through its Italian branch Marco Polo International, expressed “deep disappointment and strong opposition” to the decision. Sinochem also stated that the company has always strictly complied with laws and it would continue to exercise a dominant influence over Pirelli’s ordinary shareholders’ meeting.
Prime Minister Giorgia Meloni’s cabinet in 2023 used a “golden power” veto to restrict the Chinese firm’s access to technical information collected by sensors in Pirelli tyres, citing concerns on what it deemed to be strategic data.