Pirelli starts procedure for the valuation of the Tyre Sector

Also launches the process of disposal of financial participations with the aim of focusing on core businesses
Milan , 14 February 2006 - The Board of Directors of Pirelli & C. SpA met today and resolved to undertake procedures aimed at arriving at a better valuation of the activities of its tyre division (Pirelli Tyres), including a possible listing on the Milan Stock Exchange, while continuing to maintain the majority stake in Pirelli Tyres in the possession of Pirelli & C SpA.

The conditions of the main markets and segments in which the Group's tyre sector is active continue to be favourable, especially in the high performance segment where the Pirelli brand is recognized as a world leader. This constitutes the basis for further growth compared with that registered by Pirelli Tyres in recent years.

Together with the process of valuation of the activities of Pirelli Tyres, the Board of Directors has also approved a plan for the further concentration of resources in the Group's strategic activities through the disposal of financial participations for a sum of approximately 400 million euros, at current values, equal to about half of this portfolio.

The Board has thus given a mandate to the Chairman, Marco Tronchetti Provera, and to the Managing Director, Carlo Buora, to identify the best possible solutions for the realization of the above-mentioned operations.
The strengthening of finances and balance sheets resulting from the operations outlined above will allow the Company to fully focus on its various core businesses.

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