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Titan International has proposed offering some $150 million in unsecured notes to buy back its 8 per cent senior unsecured notes due 2012 and for “general corporate purposes.” The tender offer was effective 13 May and will remain open until 10 June Titan said in a statement issued 13 May 2010.
Michelin wants to play its part in the consolidation of the tyre industry, the company’s director of financial operations, Marc Henry told Germany's Boersen-Zeitung. According to these reports and others circulated by the Reuters news agency, Michelin will not simply remain an observer, “depending on the possibilities” of the market. Nevertheless this does not mean the company is likely to surrender its "societe en commandite par actions" status which protects it from takeover attempts as it concentrates power in the hands of the company's founding family.
Analysts have reported that Continental’s first quarter financial results (released last week) show a “100 per cent increase in numbers.” This means that, in Morgan Stanley’s view, the company’s net debt is now “under control at 8.2 billion euros,” approximately 200 million better than they expected.
“Excluding the 1.1 billion capital increase during last quarter, the net financial position deteriorated by 413m in the first quarter 2010, which was largely expected due to seasonality of working capital,” the analysts explained in an investor’s note dated 4 May, adding: “[Capital expenditure was unsustainably low, however, decreasing by 62 million euros year-on-year and represented just 63% of depreciation and amortization and 3 per cent of sales.”
Bridgestone Corp. posted better than anticipated results for the first quarter, prompting the company to make an upward revision to its FY2010 financial projections. For the quarter, Bridgestone posted sales of 659 billion yen, up 16.1% year-over-year, while net income rose from a 34.9 million yen loss last year to a net gain of 17.6 million yen.
Giti Tire’s decision to postpone its Hong Kong initial public offering, was prompted by market jitters following on from the Greek debt crisis, news agency AFP has reported. Giti, the largest tyre manufacturer in China, decided to hold-off on its $500-million dollar offering on 4 May in what was its second attempt to get such an IPO off the ground.
In addition to the macro-economic concerns that the Greek crisis is symptomatic of, in Hong Kong and China concerns also stem form Beijing’s perceived “appetite for bubble-bursting.”
Toyo Tire USA said it would again increase prices on its Toyo brand passenger, light truck/SUV, medium truck and OTR tyres, says Tire Review. The 1 June increase will be up to 8 per cent, with in-line adjustments. This is Toyo’s second price hike of the year, having taken increases of up to 7 per cent bump on medium truck tyres and up to 6 per cent on consumer tyres earlier this year.
The board of Pirelli & C. has confirmed what the market has been predicting for some time – the company has “resolved upon a plan for separation of Pirelli Real Estate” from the rest of the tyre dominated business. According to the company, such a separation will occur through the assignment of nearly all Pirelli RE shares held by Pirelli & C. to ordinary and savings shareholders of Pirelli & C., and, therefore, via voluntary reduction of the corporate capital of Pirelli & C. for “an amount equal to the value of the Pirelli RE stake being assigned.” Now shareholders have to approve the transaction by July in order for the actual separation, planned for the end of 2010, to take place.
Continental AG is said to be considering an initial public offering for its tyre unit, according to German business publication Handelsblatt. Citing “unidentified people with knowledge of the plan”, the newspaper appeared to contradict earlier reports in a Business Week interview with the company’s chief financial officer Wolfgang Schaefer that said the company doesn’t need a stock sale until 2012. However, in that interview Schaefer reportedly said: the company’s last stock sale completed in January means it now has financing until 2012 covering its net debt of 8.2 billion euros, which wouldn’t rule out an IPO in time for then.
Tire Review reports Cooper Tire & Rubber Co. reported net income of $12 million for the quarter ended 31 March, a $33 million improvement from the same period in 2009. Net sales were $754 million, an increase of $183 million, or 32 per cent, from the prior year. Operating profit was $33 million for the quarter, a $49 million improvement compared with a loss of $16 million in 2009, the company said.
Continental AG doesn’t need a stock sale before 2012 and there are no plans “in the short term” to resume talks with banks on rescheduling loans, according to chief financial officer Wolfgang Schaefer. According to a Business Week interview, the company’s last stock sale completed in January means it now has financing until 2012 covering its net debt of 8.2 billion euros. “We are not considering at all raising new capital next year. We expect to reach investment-grade status in 2012 and are therefore convinced that the current amount of equity capital is the right one,” Schaefer said.
As it has for fast-approaching 40 years, the Cooper Tire & Rubber Company announced a quarterly dividend payable June 30, 2010, to stockholders of record at the close of business June 2, 2010. The payout will be 10.5 cents per share on common stock. The payout will mark the 153rd consecutive quarterly dividend paid by Cooper Tire & Rubber Company.
Marwan Arbache, a former Michelin executive, has been found guilty of trying to sell industrial secrets to the company’s main competitor Bridgestone. The court hearing in Clermont-Ferrand reportedly delayed sentencing until 21 June 2010. Arbache faces a maximum 10-year jail sentence and a heavy fine.
The case came to trial after Bridgestone tipped off Clermont-Ferrand based Michelin that the company had received an email offering to sell them confidential tyre manufacturing information for about US$150,000 (£99,000; 115,000 euros). The email, sent in July 2007, signalled the beginning of an exchange that could have, said Michelin representatives, “delivered a serious blow to the company” if he had succeeded. Further details of the allegations involved in the case were uncovered in what the companies reportedly called "Operation Fukuda" – a sting operation which saw officials posing as Japanese clients.
Pirelli & C. SpA confirmed yesterday (3 May 2010) that its board of directors is meeting today “to examine, among other things, the transaction for separation of Pirelli Real Estate from the Pirelli Group.” According to various sources, the timing of the meeting (a day before the company’s first quarter 2010 results presentation) suggests that the company is likely to announce a spin-off of the real estate business tomorrow 5 May. Deutsche Bank analysts estimate that the move is worth 0.04 euros a share or 8.5 per cent of market capitalisation.
Michelin has released its first quarter financial report with the figure of 3.9 billion euros in net sales (representing an increase of 12.2 per cent) riding high on its statement. The manufacturer has seen a decent return to favourable comparatives a year after the depth of the financial crisis dominated most balance sheets, though European original equipment truck sales were a notable exception, down 1.2 per cent (including figures for Russia and Turkey. In comparison, year-on-year change in the segment in all other regions was up, most spectacularly in South America (up 56.9 per cent) and Asia (up 24.2 per cent). The European passenger car and light truck OE segment was much stronger, with 30.2 per cent rises in net sales.
Nexen Tire Corp.’s first quarter earnings jumped 43 per cent from a year earlier on the back of increased prices, reports Tire Review. Net profit reached 25 billion won (US$22.4 million) in the January-March period, compared with a profit of 17 billion won a year earlier, the company said in a regulatory filing. Sales increased 8.6 per cent to 249 billion won over the cited period, while operating income fell 5.1 per cent to 32.4 billion won, it said.
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