Brembo sells its entire stake in Pirelli

MILAN: Pirelli & C. SpA executive vice chairman Marco Tronchetti Provera for a third time this year raised his stake in the Italian tyremaker, after brake specialist Brembo NV sold its entire holding in the company.

The move, which sees Tronchetti nearly doubling his holding from its level at the start of the year, solidifies his position as Pirelli’s core shareholder and ends speculation that the two firms could eventually merge.

Tronchetti bought an additional 2.5% in Pirelli today, after Brembo disposed of 55.8 million shares of company common stock at €5.07 each, raising gross proceeds of around €283 million, according to a statement.

Tronchetti now owns around 25.3% of Pirelli and he has the green light to lift his stake to 29.9% in the next two years, the statement said.

Tronchetti also raised his holding in Pirelli in May after China’s Silk Road Fund Co. sold off its stake.

Pirelli makes tyres for high-end brands including Ferrari NV, McLaren Automotive Ltd. and Bentley Motors Ltd.

Brembo bought into the company in 2020 and later increased its stake.

Last year, it signed a shareholders’ agreement with Tronchetti holding company Camfin to strengthen its position. Chinese conglomerate Sinochem Holdings remains Pirelli’s largest investor.

Italy has been trying to limit China’s influence over assets it deems to be of strategic value. In 2023, the government of Prime Minister Giorgia Meloni used its "golden power” rights to impose restrictions on Sinochem’s access to information from sensors in Pirelli tyres.

Brembo’s sale, through a placing with institutional investors, represents a roughly 5.6% holding in the Milan-based tire-maker. BNP Paribas SA acted as sole global coordinator and bookrunner.

The deal reduces "the chance of a concentrated Italian-based shareholder opposition to largest (37%) shareholder Sinochem,” Bloomberg Intelligence analyst Andrew Chan wrote in a note.