Italy to Limit Chinese Influence on Pirelli
Italy limits Sinochem's influence on Pirelli, requires qualified majority for strategic decisions.
Rome, Italy — The Italian government said it will limit the influence of Chinese company Sinochem on Italian tire maker Pirelli, including imposing a mandatory qualified majority for strategic decisions made by the company's board.
The government's decision comes amid increasingly tense relations between China and Western countries.
In March, Sinochem, Pirelli's largest shareholder with a 37 percent stake, notified the Italian government of its plans to update its existing shareholder pact with Pirelli CEO Marco Tronchetti Provera, known as Camfin.
The proposed pact would have allowed Sinochem to appoint more board members and potentially choose Pirelli's future CEOs.
Rome was concerned about the Chinese company's growing influence on Pirelli, and said its planned restrictions are aimed at "shielding the autonomy of Pirelli."
The government's restrictions include a requirement that some strategic decisions by Pirelli's board of directors require approval by at least 80 percent of the directors.
The government also proposed specific measures to protect cyber-sensor technologies incorporated into Pirelli tyres.
Pirelli manufactures high-end tyres for premium carmakers, such as Ferrari, Porsche, and BMW, and is the sole tyre supplier for Formula One.
The Chinese group announced its plans to maintain its long-term investment in Pirelli earlier this year.