Michelin to purchase Flex Composite Group for €700 million

Tire manufacturing company Michelin (Clermont-Ferrand, France) has acquired 100% of Flex Composite Group (FCG, Paris) from French private-equity firm IDI for an enterprise value of €700 million.

FCG specializes in engineered fabrics and films with applications in highly technical markets such as marine, super cars and electric vehicles, sports or construction. FCG masters a wide range of fiber-reinforced composite solutions, adjacent to those already developed by Michelin. The company, which has 400 employees, primarily operates in Europe. In 2022, FCG reported €202 million in revenue. Over the 2015-2022 period, it delivered an average organic growth of 11%, with a 25-30% EBITDA margin.

This agreement, in alignment with the Michelin in Motion 2030 strategy, marks a significant step forward in Michelin’s strategy of growing its polymer composite activities in adjacent areas, leveraging innovation and R&D capabilities, and benefiting from FCG’s advanced customer intimacy and industrial process expertise; the acquisition can grow Michelin’s High-Tech Materials revenue by 20% and accelerate the growth profile of this business. Moreover, for FCG, the transaction unlocks deeper innovation synergies in a broad range of products and applications, while further improving the company’s environmental footprint.

“FCG has enjoyed very substantial growth in its business in the last years,” Florent Menegaux, CEO of Michelin, says. “This success is due to a number of key factors: Recognized expertise in composite materials and films, a capacity for innovation and a strong desire to constantly improve the service provided to its customers. With Michelin, FCG will be able to increase its capacity for innovation, its actions to reduce its environmental footprint and to provide its customers with more sustainable materials.”

The transaction is expected to close by the end of Q3 2023, subject to customary closing adjustments and merger control clearances in relevant jurisdictions.