Michelin Purchase of Conti Tyre Division Not Feasible – Analysts

Any idea Michelin has of purchasing Continental AG’s tyre business will most likely die quietly, as analysts have poured cold water on the possibility that such an arrangement would be permitted. A number of analysts have been quick to point out that a purchase of Conti’s tyre business would be seen frowned upon; it would, after all, leave the resultant company holding 40 per cent of the European passenger car tyre market and more than half of the truck tyre market. Michael Punzet, an analyst with DZ Bank, commented to Forbes that the European Commission would thus most likely not give approval as it would break competition rules.

This opinion was shared by a Michelin representative, also quoted by Forbes. “If we were approached, we would look at the proposal but we believe that our position in North America and in Europe, given the antitrust regulation, makes it difficult for us to take the tyre division from Continental,” he said.