Michelin To Transfer Russian Operations To Local Management By 2022-end

(RTTNews) - Tire manufacturing company Michelin (MGDDY.PK) announced its plans to transfer all of its Russian business to local management by the year-end.

The decision comes after Michelin suspended its activities in Russia on March 15 in response to Moscow's invasion of Ukraine.

"The Group is therefore compelled to plan the transfer of all of its Russian operations by the end of 2022 and is considering the possibility of transferring control of its administrative, sales and industrial operations to the current local management. In doing so, Michelin is preparing the most favorable framework possible for its employees," the company announced in a statement.

The new entity would operate through an independent structure from Michelin.

Michelin employs about 1,000 people in Russia, including 750 at the Davydovo plant, located about 100 kilometers from Moscow. The site has an annual production capacity of 1.5 to 2 million tires, mainly for passenger cars. Michelin's sales in the country represent 2% of the Group's total sales and 1% of its global car tire production.

Michelin's balance sheet exposure is currently estimated to be 250 million euros, or $265 million, from Russian operations. The company explained that the transfer of operations would not impact its financial guidance.