China's Sinochem sells 14% Pirelli stake to Czech billionaire Michal Strnad

MILAN, July 30 (Reuters) - Sinochem has sold a 14% stake in Pirelli to Czech billionaire Michal Strnad, the two parties said on Thursday, with the Chinese state-owned group significantly scaling back its investment in the Italian tyremaker.

Sinochem said it had sold the shares, part of its overall 34.1% shareholding through a block-trade deal, cutting its stake to 20.1%, this becoming Pirelli's second largest investor.

In a separate statement, Strnad's investment company Lumina Crown said it had acquired the 14% stake, becoming Pirelli's third largest shareholder and aiming for a "long-term investment" in the company.

Strnad is the controlling shareholder of defence and industrial group Czechoslovak Group (CSG).

According to data reported on the Italian stock exchange website, the shares were sold at €6.50 each, valuing the 14% stake at around €987 million ($1.14 billion).

Pirelli shares closed at 6.51 euros on Thursday.

The sale draws a line under years of tensions between Pirelli's main investors following Italy's moves to curb Sinochem's influence at the company.

As a consequence of the deal, Camfin - the vehicle of Executive Chairman Marco Tronchetti Provera, the Italian businessman who has led the Milan-based tyre maker for more than three decades - becomes Pirelli's largest shareholder with a 26% stake.

Sinochem's influence over the company has been sharply curtailed since the Italian government intervened twice, in 2023 and earlier this year, using its so-called "golden power" rules to protect strategic assets.

Under more recent restrictions imposed by Rome, Sinochem got just three representatives on Pirelli's 15-member board, which is effectively controlled by Camfin. Its appointees are also barred from holding key executive positions such as chairman or chief executive.

Sinochem was advised in the deal by BNP Paribas; Lumina Crown was advised by Jefferies.

($1 = 0.8674 euros)

(Reporting by Giulio Piovaccari and Elvira PollinaEditing by Keith Weir and Susan Fenton)