Mon God, keep me from my friends… Marco Tronchetti Provera should have revised his classics before selling the majority of the capital of Pirelli, the Italian industrial jewel, to the Chinese group ChemChina in 2015 for nearly seven billion euros. At the time, the historical boss of the chemical company, Ren Jianxin, had found in the Milanese entrepreneur a “teacher, a brother and a friend”. From now on, the Italian boss, still at the head of his company, fulminates against his owners. “The Chinese are dangerous and the future of Pirelli is in danger”he says now.
It must be said that things have changed a lot in Beijing since the time of the effusions between Marco Tronchetti Provera and Jianxin. The latter was abruptly retired by the government, when his company was bought out by a state company, Sinochem. Then Xi Jinping decided to strengthen state control over the economy.
THE FinancialTimes recounts in detail how relations began to sour. In an internal communication dated September 16, 2020, an assistant to the general manager of Sinochem asks Pirelli subsidiaries in China to inform the parent company of any contact with foreign governments and diplomats, including Italians.
Then on November 3, Communist Party representatives at Sinochem demanded that all of the group’s subsidiaries, including Pirelli China, adopt Xi Xinping’s three-year action plan and that all managerial decisions be reviewed and discussed. by party committees in all enterprises.
Narrow room for maneuver
The loss of control of Chinese activity is not the only obstacle in the way of the famous Italian industrialist. The United States has added ChemChina to the list of Chinese military companies. In other words, continuing to do business in the United States risks becoming more and more complicated for the Milanese manufacturer. Finally, Beijing is now pushing for a change in the governance of the company on the occasion of the departure of Marco Tronchetti Provera to appoint his men.
The government of Giorgia Meloni would have done well without this affair. Its room for maneuver is narrow in the case of a listed company, of which ChemChina holds 37% of the capital, and whose technologically sensitive nature is not easy to prove. Moreover, Rome is seriously considering withdrawing from the major Chinese “Silk Roads” project, but would like to avoid a diplomatic crisis.
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