Michelin Raises its Hankook Stake to 8.9%

Michelin has increased its shareholding in South Korean tyre manufacturer Hankook Tire to 8.9 per cent up 2.6 points from the stake it bought in 2006. A Michelin spokesperson told Tyres & Accessories the company would not comment on whether it plans to increase the stake again, but did say the move falls within the boundaries of Michelin and Hankook’s 2003 cooperation agreement. T&A understands that this agreement would allow Michelin to own up to 10 per cent of Hankook’s total capital. Hankook shares rocketed 15 per cent in response to the news before adjusting to a daily value increase of 12.4 per cent. Michelin’s stock, on the other hand, fell 2.2 per cent following the announcement.

Reports primarily from the Reuters news agency questioned whether or not the news was sign that Michelin may be gearing up for an acquisition. Prior to the announcement Michelin already owned 6.3 per cent of Hankook, however family and so-called “friendly shareholders” reportedly hold a combined 35 per cent of the South Korean company. However, Michelin representatives in Paris told Tyres & Accessories that there was “nothing hostile in the stake raise today.”

HSBC bought 2.84 million shares of Hankook Tire on Wednesday 18 June (the most active buyer of the day, making up half of Hankook Tire’s total daily trading volume), according to the Korean Exchange’s data.

Michelin’s decision to increase its stockholding in its strategic partner comes just over a month after Bridgestone bought 8.7 per cent of Toyo Tire & Rubber.