PARIS - Groupe Michelin has bought 51 percent control of steel and aluminum wheel producer Mannesmann Kronprinz AG. The deal effectively doubles Michelin's sales base for wheels, to nearly $400 million. A transaction price was not disclosed.
The sale could lead to wide-ranging cooperation in the wheel business.
Michelin's claimed production capacity at plants in Troyes, France, and Aranda, Spain, is 46,000 wheels a day. Sales from these activities reached FF1 billion ($196 million) in 1996.
Kronprinz, a subsidiary of Germany's Mannesmann AG, had sales of DM290 million ($193 million) last year from its plant in Sollingen, Germany.
Michelin began producing steel wheels last year. The new product, called Iris, features a styled stainless steel trim cove. It represents an alternative to styled cast-alloy wheels and traditional hubcaps.
Michelin has also expanded into aluminum truck wheels, in a joint venture with the French aluminum producer Societe Pechiney. Their product, the Inovial, is up to 40 percent lighter than a steel wheel.
Michelin is a leader in the European tire/wheel mounting business. It has 13 European units, including joint ventures. Continental AG has 12 sites. They plan to combine some of their activities in the future under a newly formed venture, the MC Project.
The Michelin-Kronprinz deal follows, by several months, another major deal.
Hayes Wheel International Inc. of Romulus, Michigan, announced in December 1996 that it would buy majority control of Lemmerz Holding GmbH of Konigswinter, Germany.
This will create a group with global sales estimated at $1.5 billion. Hayes will pay $295 million for 76.6 percent of Lemmerz.