Our acquisitions and investments strategy

The Mergers & Acquisitions activity is one of the Group’s strategic resources to achieve its targets for growth and innovation, as well as to protect its competitive edge and to explore market conquests.

 

To achieve those goals, the M&A teams use a wide range of approaches, carefully selected to fit the issues and business targets involved: total acquisition, purchase of a stake, merger, creation of a joint venture, etc. These approaches hedge against the unique risks inherent in each transaction.

 

These transactions always involve third parties and require a multidisciplinary group that includes business representatives, finance, tax specialists and lawyers, in which the Mergers & Acquisitions team plays a pivotal role.

 

The latest Mergers & Acquisitions reflect the Group’s development strategy:

 

  • Taking advantage of opportunities in our core business, on both the tire manufacturing (Levorin, Camso) and distribution (Allopneus, TBC) sides
  • Developing and enhancing our tire-related service offer (Sascar, NexTraq)
  • Leveraging our renowned expertise and skills in high-tech materials (Lehigh Technologies, Fenner)
  • Creating new mobility experiences to help travelers improve their experience by discovering new services, sites and restaurants with our maps, guides and apps. (The Fooding guide)

 

Overview of the Mergers & Acquisitions Process

 

Buying a company is a complex, highly structured process that lasts several months. A standard acquisition involves the following steps and activities ...

 

Tires

In our quest for external growth, we seize the opportunities that arise in our core business, in both tire manufacturing and distribution.

 

 

Case study: Camso

 

With its acquisition of Camso on July 12, 2018, Michelin strengthened its leadership position in the specialties business by creating the world leader in off-road mobility. The new division, which reflects a major strategic partnership in off-road products, will be run from Quebec (Canada).

 

This strategic partnership, driven by shared values and a strong tradition of innovation and R&D and built on the strengths of expert teams, will make the new entity the world leader in off-road mobility.

 

Camso, a designer, manufacturer and distributor of off-road mobility solutions since 1982, has annual turnover of $1 billion (USD). It is the leading player on several markets, including rubber tracks for farm equipment and snowmobiles, and the materials handling equipment market, with bias tires whose carcass layers are made of nylon folds positioned on the lateral surfaces and the tread at a 55-degree angle. These tires are ideal for work on rough ground. Camso is also one of the top three players on the construction market, on both tracks and tires for small construction equipment.

 

Its technological leadership on tracks and track systems, its competitive industrial network, particularly in Sri Lanka, and the reputation of its Camso and Solideal brands have helped it grow quickly, with average annual growth of 7 percent since 2012.

 

This acquisition has created the world leader in the off-road market. The new entity will be managed from Magog, Quebec, to benefit from Camso’s managerial expertise and Michelin’s historic presence in Canada, in both Laval and Nova Scotia. This new global leader boasts turnover double that of Camso, is served by 26 plants and a staff of close to 12,000, and enjoys access to sustainably strong markets.

Tire-related services

Acquiring new companies helps us develop and enhance our tire-related service offers for individuals and businesses alike. 

 

 

Case study: Sascar

 

The 2014 acquisition of Sascar, Brazil's top digital fleet management (33,000 fleets under management, 190,000 trucks) and freight security company, allowed Michelin to expand its service offer for shipping companies and accelerate the growth of its truck business in Brazil. Joining the Michelin Group brought Sascar access to its major customers in Brazil and across South America.

 

 

Case study: NexTraq

 

With its June 2017 acquisition of NexTraq, a US digital fleet solutions provider, Michelin is expanding its utility vehicle fleet management capacities in the US. NexTraq’s solutions improve driver safety, fuel management, and fleet productivity. Since it was founded in 2000, NexTraq has become a leading tracking solution supplier for light utility vehicle fleets (classes 3-5) with 2 to 50 vehicles.

Mobility experiences

External growth also offers a way to improve our service offer by bringing travelers new experiences on the go.

 

 

Case study: the Fooding Guide

 

On September 1, 2017, Michelin announced that it had purchased a 40% stake in Fooding, which publishes a guide and restaurant listing by the same name. The Fooding Guide, created in Paris in 2000 by journalist Alexandre Cammas, is popular for its whimsical approach to haute cuisine and interpretations of trends.

 

Michelin and Fooding’s partnership is designed to create diverse and exclusive culinary experiences for customers, ranging from discovering outstanding restaurants to meeting Chefs at custom events or putting together special offers with its partners in France and worldwide.

High-tech Materials

Our expertise in high-tech materials for more sustainable mobility is key to making our products stand out. We sometimes enhance our globally recognized expertise by acquiring new companies.

 

Case study: Lehigh Technologies - producing innovative recycled materials

 

Lehigh Technologies specializes in designing and producing innovative materials by recycling end-of-life tires and other rubber-based industrial products.

 

With its October 2017 acquisition of Lehigh Technologies, Michelin is continuing its strategic drive to promote its expertise in high-tech materials beyond tires.

 

Lehigh Technologies develops and produces highly technical recycled materials which can be used in new tires. These Micronized Rubber Powders (MRP), produced using cryogenic micro-grinding technology, offer a way to reclaim end-of-life tires.

 

This high-performance, long-lasting, low-cost material can replace other components in tires, plastics, asphalt, and construction materials.

 

Our customers already include major global tire manufacturers as well as asphalt, construction materials and other manufacturers.

 

 

Case study: Fenner and reinforced polymers.

 

In March 2018, Michelin acquired all the shares in Fenner PLC, the global leader in industrial belting and reinforced polymer-based products. This decision furthers the Group’s goal of promoting its expertise in high-tech materials.

 

With this acquisition, the Group now has a holistic offer of tires and industrial belting as well as solutions and services for mining sector customers.

 

Fenner’s expertise will also enable Michelin to develop reinforced polymer technologies for the consumer goods and industrial and medical equipment markets.

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