Tyre giant Michelin snaps up UK firm
French tyre maker Michelin, which closed its operation in Northern Ireland this year, has struck a deal to acquire British manufacturer Fenner in a £1.2bn deal.
The groups announced the deal after market close yesterday, with Michelin to shell out 610p per Fenner share, a 31% premium to the FTSE 250 firm's closing price on March 16.
Fenner, based in Hessle in East Yorkshire, manufactures conveyor belts and reinforced polymer products for mining and industrial markets.
It raked in £655m in revenue last year and Michelin said the deal could unlock £30m in annual cost savings through processing efficiencies and leveraging R&D skills.
Michelin boss Jean-Dominique Senard said: "Mastering high-technology materials is key to creating value in the coming years.
"The acquisition will enable Michelin to accelerate its growth in this area, and to strengthen its position as a key player in the recovering mining markets with a comprehensive offering."
Fenner's directors said they believe the offer to be fair and reasonable and unanimously recommend shareholders accept the deal.
Its chairman Vanda Murray said: "Fenner has successfully established itself as a world leader in reinforced polymer technology and the board remains confident that Fenner's existing strategy would deliver significant value for Fenner shareholders as an independent company."
Three years ago, Michelin announced it would be shutting its factory in Ballymena with the loss of 560 jobs due to a fall in demand for its truck tyres and the growth of Chinese imports.