Michelin senior bosses launch charm offensive

MICHELIN senior management, including chief executive Michel Rollier, will meet investors and analysts this week to reassure them over the group’s €1.2bn (£1.03bn) rights issue.

The group yesterday said it remained confident about its move despite the intensely negative reaction from the market over its deeply discounted rights issue, which saw shares plummet by more than 10 per cent on the day it was announced.

Rollier is to meet with analysts and investors throughout next week to defend the group’s move and explain Michelin’s long-term strategy. The group launched the rights issue to help fund expansion and to prop up its credit rating.

But brokers, along with investors, were surprised by Michelin’s announced move.

UBS analysts said yesterday in a note that the bank had also been surprised by the timing of Michelin’s decision.

Similarly, Standard & Poor’s Equity Research said it believed that Michelin’s sudden change in strategic emphasis had been taken negatively by the market, while AlphaValue downgraded the French group to “add” from “buy” on the news.