Aeolus raising funds for acquisition of industrial tyre makers.
China-based Aeolus Tyre has announced it plans to purchase a 90% stake in Prometeon Tyre and other industrial tyre assets to improve its global ranking in the segment.
The industrial tyre firm is seeking to raise 5.8 billion yuan (about $841 million) for the purchase of Prometeon, Pirelli’s renamed industrial tyre business, through a public stock offering, according to news reports. The completed acquisition, which is subject to regulatory approval, would make Aeolus China’s largest tyre producer with industrial, farm, and truck and bus tyre capacity of 18 million units. Aeolus currently owns 10% of Prometeon with the remaining 90% valued at $680 million.
Aeolus Tyre also intends to acquire Guilin Tyre, a Chinese company with truck and bus tyre capacity of 1 million units annually. Both Prometeon and Guilin are affiliates of ChemChina.
Aeolus said it will also raise up to $295 million through private placement for expansions projects in China and Prometeon’s sites overseas. The expansion projects and acquisitions are intended to optimize the company’s global tyre capacity and create better service in local markets, the company said.