Italy opens procedure against China’s Sinochem for feasible breach of Pirelli governance

MILAN — Italy has opened an administrative procedure against China’s Sinochem, the largest shareholder in Italian tiremaker Pirelli, for a feasible breach of restrictions designed to protect national strategic assets.

Pirelli announced Wednesday that the procedure was launched under the so-called “golden power” provisions, which include restrictions to the access of some information and higher vote thresholds for strategic decisions, invoked by the Rome government in mid-2023.

Pirelli said Sinochem, which controls a 37% stake in the corporation, has denied any violations of the restrictions, adding the Italian government had 120 days to issue a finding.

In announcing the golden power provision, the government cited the sensitivity of sensors implanted in tires that can collect data such as road layouts, geolocation and the state of infrastructure, making it of a “critical technology of national strategic importance.”

The tiremaker’s second-largest investor is Camfin, the financing vehicle of Pirelli’s former CEO and current executive vice-chairman Marco Tronchetti Provera, which holds a 32.4% stake.