MILAN—Pirelli & C. S.p.A. shareholder Camfin S.p.A. is evaluating a partnership with Chinese rubber magnate Niu Yshun to increase its stake in the Italian tire maker's shares.
Camfin recently disclosed it had signed a preliminary and non-binding memorandum of understanding with Longmarch S.a.r.l., a financial vehicle owned by Mr. Niu to develop private-equity initiatives.
The proposed partnership will create a joint venture, led by Camfin, to which Logmarch will transfer its 5.2% long position in Pirelli. Camfin, in turn, would contribute call options it holds on 4.89% of Pirelli's share capital.
In addition to the proposed financial instrument, Camfin also owns a 10.1% direct share in Pirelli.
Longmarch is headed by the Chinese Niu family, with which Pirelli has had "industrial relationships" since the opening of its first plant in China in 2005.
The MoU was signed a day after Italian high-performance braking systems producer Brembo S.p.A. announced it had acquired a minority share in Pirelli.
In response to the new investments, Camfin Chairman and CEO Marco Tronchetti Provera — who also is executive vice chairman and CEO of Pirelli — said the moves "confirm the quality of the work done in these years."
The course of the Pirelli's business will continue "unchanged," Mr. Tronchetti Provera said.