Chinese company to buy Italian tyre maker Pirelli in $7.7 bln deal

China National Chemical Corp (ChemChina) is to buy Pirelli, the world's fifth-largest tyre maker, in a 7.1 billion euro ($7.7 billion) deal that will place one of the symbols of Italy's manufacturing industry in Chinese hands.

The deal agreed with Pirelli shareholders on March 22 is the latest in a string of takeovers in Italy by cash-rich Chinese buyers, who can take advantage of a weak euro just as signs emerge that Europe is coming out of economic stagnation.

It will give state-owned ChemChina, led by acquisitive chairman Ren Jianxin, access to technology to make premium tyres, which can be sold at higher margins, and give the Italian firm a boost in the huge Chinese market.

The bid for Pirelli marks a return of China's state-owned enterprises (SOEs) to global dealmaking following a hiatus prompted by President Xi Jinping's anti-graft crackdown that targeted several current and former senior SOE officials.

It would be China's fifth-biggest outbound deal by an SOE, according to Thomson Reuters data, and the first major acquisition since China's MMG Ltd led a consortium last year to buy the huge Las Bambas copper mine in Peru from Glencore.

ChemChina's tyre making unit China National Tire & Rubber will first buy the 26.2 percent that Italian holding firm Camfin owns in Pirelli, and will then launch a mandatory takeover bid for the rest.

The bid will be launched by a vehicle controlled by the Chinese state-owned group and part-owned by Camfin investors, who include Pirelli boss Marco Tronchetti Provera, Italian banks UniCredit and Intesa Sanpaolo, and Russia's Rosneft, Camfin said in a statement.

The offer will be launched at 15 euros per share, valuing the group at 7.1 billion euros excluding net...