Michelin is set to invest $1.45 billion for the acquisition of Camso which also makes specialty tires including snowmobile tracks. The deal is expected to generate $55 million in higher sales by 2021 while lowering the expenses. Closely held Camso, which has had sales of $1 billion’s headquarters in Magog, Quebec will be the two companies off road operations center.
According to Michelin Chief Financial Officer Marc Henry:
“The specialty-tire market is by far the fastest-growing. This merger is a perfect fit for Michelin and Camso.”
Michelin shares rose as much as 2.5 percent after the news.
Camso also has a manufacturing site in Sri Lanka and has grown at an average of 7 percent since 2012 and is ranked among the top three companies in making tracks and tires for construction equipment.
Michelin investment values the Camso at $1.7 billion including net debt and the French company also agreed to keep Camso’s headquarters in Quebec.
Camso shareholder include Caisse des Depots et Placements du Quebec which is Canada’s second largest pension fund manager, Quebec’s Solidarity Fund QFL, which is backed by a labor union; Mouvement Desjardins, Canada’s biggest credit union; and three individuals.
Headquartered in the USA, Michelin Corporation manufactures, distributes, and sells tires and offers tires for cars, vans, trucks, buses, farm machinery, earthmovers, mining and handling equipment, tramways, metros, aircrafts, motorcycles, scooters, and bicycles.
Founded in 1958, Camso Inc. manufactures and distributes pneumatic, airless, and solid tires, tracks, driven and trailed conversion track systems, and OEM undercarriages for material handling, construction, agriculture, and power sport industries. Headquartered in Canada, Camso offers solideal tires and wheels for forklift vehicles; and tires, tracks, and over-the-tire-tracks for articulated dump trucks, backhole loaders, carriers, and compact load loaders.