Non-tyre growth: Michelin divests majority share in healthcare subsidiary, gains new partner

At the unveiling of its ‘Michelin in Motion’ strategic plan on 8 April, the Michelin Group presented a strategy for 2030 that shows a determination to expand in non-tyre businesses. In this spirit of expansion beyond tyres, yesterday the company announced the signing of a Partnership Agreement with Altaris Capital Partners.

Under the terms of this agreement, for an undisclosed sum Altaris will acquire a 51 per cent stake in Solesis Inc., a business that joined the Michelin Group through the purchase of Fenner in 2018. Michelin will maintain a 49 per cent interest and will formalise a research and development initiative with Solesis to develop advanced polymers for life sciences and medical technology applications.

Transferring a 51 per cent stake in Solesis to Altaris is one of three components of the Partnership Agreement. It also covers the set-up of a governance system that would enable the two Solesis shareholders to support the businesses’ development and expansion. In addition, as mentioned above it provides the starting point for a research and development partnership between Michelin and Solesis to continue co-developing biopolymers focused on the intersection of polymer science and biology.

The planned transaction is subject to the customary regulatory approvals.

Solesis & Altaris

Based in the United States, Solesis employs 360 people across four production facilities located in Pennsylvania and North Carolina. The company was created in 2002 and specialises in biomaterials for the Healthcare industry, in particular critical textile components for implantable medical devices and, since 2015, single use technologies for the biopharmaceutical market, while also pursuing new activities in specialty polymers. Customers know Solesis through two major brands, Secant Group and Charter Medical.

The Secant Group, which includes SanaVita Medical, is a leading supplier of biomaterials and implantable textile structures that enable repair, recovery and regeneration of human tissue, as well as technical materials for the specialty chemical and aerospace markets. Charter Medical supplies single-use tools for cell culture expansion, cryopreservation and fluid management that are used during the development and manufacturing of biopharmaceuticals, including cell and gene therapies.

Altaris is an investment firm focused exclusively on the healthcare industry, with significant experience in the life sciences and medical technology sectors, and a track record of working successfully to grow companies alongside corporate partners. Altaris manages US$5.2 billion of equity capital and is based in New York City.

Unleashing the value of Michelin’s expertise

“Our teams have acquired exceptional expertise in the physics and chemistry of High-Tech materials, including their simulation, production, scale-up and applications,” comments Sonia Artinian-Fredou, the Michelin Group’s executive vice-president, High-Tech Materials. “This knowledge can be transferred to new, high-growth areas. The signing of this partnership agreement is fully aligned with the Group’s strategy and reflects its goal of unleashing the value of its expertise beyond tyres. “

“Over the years, Solesis has established a successful business built on differentiated technology platforms. We are thrilled to enter the next phase of our journey in partnership with Altaris and Michelin, which will enable us to accelerate our business strategy and growth plans,” adds Karen West, chief executive officer of Solesis. “Through increased investment in R&D and enhanced access to capital, we intend to continue to develop innovative technologies to meet the evolving needs of our customers and their rapidly expanding end markets. This is an exciting time for Solesis, our customers and our dedicated team.”

“We are delighted to have this opportunity to partner with Solesis and Michelin,” says George Aitken-Davies, co-founder and managing director of Altaris. “We believe Solesis is a market-leading provider of biomaterial technologies and will continue to make significant contributions to advancements in the life science and medical technology fields. We look forward to working closely with Michelin and the Solesis team to develop and grow the company in the years to come.”

Markets with strong growth potential

In recent years, Solesis has expanded rapidly to support its customers in the medical device technology markets and through its single use platform in the biopharmaceutical market, with focus on cell & gene therapy, notably thanks to support from Michelin.

Altaris’s acquisition of a stake in Solesis will accelerate its development in current and new markets, which are among the strongest growing in the healthcare industry, with prospects for growth of between 10 and 30 per cent.