Goodyear Tire & Rubber Co.
GT, + 19.29%
agreed to cooperate with Tire & Rubber Co.
CTB, + 29.95%.
A deal that Goodyear announced would allow it to cut costs and expand its businesses in the US and China.
Goodyear announced Monday that it will pay around $ 2.8 billion in cash and stock for its smaller rival, including $ 41.75 in cash for Cooper’s stock, which rose 30 percent late in the morning trading rose to $ 56.86. Goodyear’s stock rose 22% to $ 16.97.
The combined company would generate annual sales of approximately $ 17.5 billion and employ approximately 72,000 people worldwide, according to an investor presentation. Cooper’s tire brands include the line of the same name and Mastercraft.
Richard Kramer, Chief Executive of Goodyear, said in a conversation with investors that the proposed acquisition would bring the combined company’s replacement tire sales volume to approximately 64 million in the United States. In China, the deal would help Goodyear sell more new and replacement tires, with the latter market expected to grow rapidly in the coming years, he added.
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