Pirelli rejects idea of spin-off: 'Cyber Tyre will remain integrated'

Pirelli's board of directors rejected the proposal by Sinochem, the tyre group's largest shareholder with 37%, regarding the corporate segregation of the Cyber Tyre business. "The board of directors has agreed by a majority, with nine votes in favour and five against, with the evaluations of the CEO, Andrea Casaluci, regarding the Cyber Tyre activities that must continue to be exercised and developed in a fully integrated manner, also on a functional and organisational level, with all the other activities of the group," reads a note released by the Bicocca-based group.

Voting against management's considerations were Chen Aihua, Zhang Haitao, Chen Qian, Fan Xiaohua, and Tang Grace. The majority, however, rejected the proposal, with the board broadly agreeing on one point above all: Cyber Tyre's activities must 'be managed in full coherence and in compliance with the strategic and industrial approach illustrated by the CEO, with the express exclusion of any project or initiative that could lead to forms of compartmentalisation, separation and/or segregation, even if only partial and of any nature'. Finally, the board also took note of the notifications to the golden power for non-renewal of the shareholders' agreement, which took place on 30 January.

In detail, during the meeting Pirelli's management drew the board's attention to the competitive scenario of the automotive sector. This scenario is now characterised - the note reads - by increasingly integrated and connected systems and vehicles (software defined vehicles and autonomous driving systems), within which the tyre has undergone a radical transformation, also becoming a complex and technologically advanced system that collects, processes and transmits data. Pirelli, it is recalled, was the first to develop and launch a hardware and software technology, Cyber Tyre, that communicates in real time with the car's systems.

This technology, as proof of its strategic relevance and validity, has already been adopted by some of the major Prestige car manufacturers, and other agreements are in the pipeline. Cyber Tyre is also able to dialogue with road infrastructures, enabling smart road services and the monitoring of road and motorway networks. Agreements to this effect are already underway with the Puglia Region, Movyon and Anas. Hence the centrality of the Pirelli system, which is incompatible with any fragmentation of the Bicocca group: "It would have no chance of being realised as it would irreversibly undermine the integrated business model, where technology and innovation, product development, production and marketing live in a constant interchange of information and data".

On the Sinochem front, it is reported that the Chinese group has submitted to the Prime Minister's Office the notification pursuant to the Golden Power decree, in which it communicates, in addition to the non-renewal of the shareholders' agreement pertaining to Pirelli, the proposal of potential corporate segregation of the Cyber Tyre business and changes to the mechanism for the appointment of the members of Pirelli's board of directors. Both proposals are subject to conditions set by Cnrc, including "a prior assessment that ascertains the qualification of the Cyber Tyre business as a "critical technology" pursuant to Dpcm 179/2020 and the relevance, for the purposes of the application of the Golden Power regulations, of Pirelli's activities in the US regulatory and market context". On the stock market, Pirelli shares closed down 0.3%.