The Michelin Man is set to take on much more field work with a US$1.45 billion deal for Quebec off-the-road track and tire manufacturer Camso.
The deal, pending regulatory approval, calls for France’s Michelin to combine its off-the-road (OTR) business with Camso in a new division.
“By joining forces with Camso, Michelin will create the world’s No. 1 OTR market player, headquartered in Quebec,” Michelin said July 12.
“As world leader, the new entity will represent more than double the net sales of Camso” including 26 plants and about 12,000 employees, producing for “sustainably dynamic markets.”
For the agricultural market, the deal is expected to create “a unique player providing its customers with a comprehensive range of premium radial tires and tracks.”
Equipment brands featuring Camso tracks today include CNH’s Case, Case IH and New Holland, Agco’s Massey Ferguson, Fendt and Valtra, John Deere, Versatile, Brent, Caterpillar, Claas, Deutz-Fahr, J+M and Laverda.
The new division, Michelin said, will combine the “expertise of Camso’s management team and Michelin’s long-standing presence in Canada” which includes three automotive tire plants in Nova Scotia and operations at Laval, Que.
Michelin today makes its agricultural tires in France, at a dedicated plant at Troyes, southeast of Paris.
Michelin said it has identified “significant opportunities to increase sales and reduce costs” through Camso, thus “unlocking up to US$55 million in synergies by 2021.”
However, Michelin said it has also committed to have the new division’s “decision-making centre” at Camso’s headquarters in Magog, Que., southwest of Sherbrooke, and to maintain a “stable” employee headcount at Camso’s headqarters as well as its existing R+D operations and production jobs in Quebec.
“The new skill sets required to oversee this global business, and the anticipated growth in the division’s net sales, will lead to the creation of new high-quality jobs in the Magog region in the coming years,” Michelin said.
Camso is billed as a “market leader in rubber tracks for farm equipment and snowmobiles, and in solid and bias tires for material handling equipment” and is among the top three in tracks and tires for small heavy equipment.
The company formed in 2010 in a merger of Quebec’s Camoplast and Luxembourg’s Groupe Solideal and rebranded as Camso in 2015. Its operations today include 22 manufacturing plants in 10 countries.
“Joining up with Michelin’s off-the-road teams is a fantastic opportunity for Camso because of the similarity of our cultures as well as our growth potential,” Camso executive chairman Pierre Marcouiller said in Michelin’s release.
“Camso will achieve its ambition to become the global off-the-road market leader and will contribute its dynamic teams, its technical and manufacturing assets and its customer-focused mindset.”
Michelin’s deal, he added, already has the backing of all Camso shareholders. — AGCanada.com Network