Power International Tires acquiring Michelin’s activities in Russia

Michelin announces that it has signed an agreement with Moscow-based tyre distributor Power International Tires LLC for the purchase of its two local companies, Michelin Russia Tyre Manufacturing Company (MRTMC) LLC and Camso CIS LLC. A known partner of Michelin, Power International Tires is one of the country’s main tyre distributors and has a presence throughout Russia.

Approved by the competent local authorities, this agreement will enable 250 of Michelin’s local workforce, mainly at the Davydovo site, to retain their jobs. Michelin states that the option to pass the activity on to local management was “not possible” due to “major difficulties preventing these activities from being rendered autonomous.” As Power International Tires has not taken on all staff, Michelin says it “allowed those who wished to leave the company under good conditions to do so.”

All costs relating to the cessation of activities in Russia have been accrued for in 2022. Michelin Group will, however, recognise in May 2023 an expense estimated at a “few tens of millions of euros” corresponding to currency translation differences. This expense will be recognised in operating income, not allocated to the segments, and therefore has no effect on the Group’s 2023 guidance.

A major step

Michelin suspended its industrial activities in Russia on 15 March 2022, following the start of the conflict in the Ukraine the previous month. The company considers the sale of its activities in Russia to mark a “major step” in its history, as it had been present in the country since 1997.