News | One Equity Partners
JUN292006
Private placement of 38.9% of Pirelli Tyre for 740 million Euros signed

The Stake will be bought by an Investor Group constituted by primary Italian and International Financial Institutions; the aim of the transaction is a subsequent IPO.

Milan - The Pirelli Group reached an agreement with a number of primary Italian and international financial institutions –Banca Intesa, Banca Leonardo Group, Capitalia, One Equity Partners - JP Morgan Group, Lehman Brothers and Mediobanca (or the "Investor Group") – for the disposal of 38.9% of the capital of Pirelli Tyre SpA for a consideration of 740 million euros, which equates to an equity value for the whole company of approximately 1.9 billion Euros.

Upon consummation of the transaction, OEP - JPMorgan Group will own approximately 7.5% of Pirelli Tyre SpA.

The agreement allows the Investor Group to launch and conduct, within a period of four years and six months from the date of closing, an Initial Public Offering of the shares acquired.

Pirelli has the option to re-acquire the shares being sold if, after the four years and six month period, those shares have not been the object of an IPO. The re-acquisition price, to be calculated at the moment of the option's eventual implementation, will be the higher between the market value of Pirelli Tyre at that moment and the price originally paid by the buyers plus an agreed yield.

About Pirelli Tyre: Pirelli Tyre is the world’s fifth largest operator in terms of turnover on the tyre market, with levels of profitability among the highest in the sector. In 2005, the activities today under the aegis of Pirelli Tyre generated revenues of around 3.63 billion Euros, with a growth of almost 12% with respect to the previous year.

UPDATE:

The closing of the transaction took place on August 1, 2006.