Michelin Announces the Acquisition of Flex Composite Group

• Creating a leader in high-tech engineered fabrics and films, increasing by c. 20% the revenue of Michelin’s High-Tech Materials businesses.
• An important step to develop Michelin beyond mobility and position it as a key player in polymer composite solutions, in line with Michelin in Motion 2030 strategy.
• Leveraging both companies’ distinctive capabilities to unlock deep-innovation synergies in a broad range of products and applications.
• Michelin’s growth profile enhanced, EBIT-margin accretive for Group and Specialty segment, positive cash generation and EPS impact.
• Acquisition financed through available cash, Michelin’s strong financial position maintained
• Closing of the transaction expected around end of Q3 2023.

Michelin and IDI announce today they have reached an agreement on the terms by which Michelin would acquire 100% of Flex Composite Group (FCG) for an enterprise value of €700 million.

FCG is a European leader in engineered fabrics and films with applications in highly technical markets such as marine, supercars & electric vehicles, sports, or construction. FCG masters a wide range of polymer composite solutions, adjacent to those already developed by Michelin. The company has 400 employees. It primarily operates in Europe, in fast-growing markets with strong demand dynamics catering to high end customers. In 2022 FCG reported €202 million revenue. Over the 2015-2022 period, it delivered an average organic growth of 11%, with 25 – 30% EBITDA margin.

The agreement would enable Michelin and FCG to create a leader in high-tech engineered fabrics and films. This acquisition is in perfect alignment with Michelin in Motion 2030 strategy. This will mark a significant step forward in Michelin’s strategy of growing its polymer composite activities in adjacent areas, leveraging unrivalled innovation and R&D capabilities, and benefiting from FCG’s advanced customers intimacy and industrial process expertise.

The transaction would unlock deep innovation synergies in a broad range of products and applications, while further improving the environmental footprint of FCG. FCG acquisition would grow Michelin’s High-Tech Materials revenue by c.20% and accelerate the growth profile of this business. The transaction would be EBIT margin-accretive for Michelin at Group level and for the Specialty segment it will belong to, with positive cash generation and EPS impact.

Source: Michelin