The Goodyear Tire & Rubber Company (NASDAQ: GT) and Cooper Tire & Rubber Company (NYSE: CTB) reported entry into a definitive transaction agreement where Goodyear will acquire Cooper in a transaction with an enterprise value of USD 2.5 Billion. The transaction will help expand Goodyear’s product offering by combining the portfolios of both complementary brands. Together, the combined company will have a USD 17.5 Billion in pro forma 2019 sales. The terms of the transaction has been approved by boards of directors of both companies as Cooper shareholders will receive USD 41.75 per share in cash and a fixed exchanged ratio of 0.907 shares of Goodyear common stock per Cooper share for a equity value of USD 2.8 Billion. This is based on Goodyear’s closing stock value on February 19th, 2021.
“This is an exciting and transformational day for our companies,” said Richard J. Kramer, Goodyear chairman, chief executive officer and president. “The addition of Cooper’s complementary tire product portfolio and highly capable manufacturing assets, coupled with Goodyear’s technology and industry leading distribution, provides the combined company with opportunities for improved cost efficiency and a broader offering for both companies’ retailer networks. We are confident this combination will enable us to provide enhanced service for our customers and consumers while delivering value for shareholders.”
Kramer added, “We have a great deal of respect for Cooper’s team and share a commitment to integrity, quality, agility and teamwork. We look forward to welcoming Cooper to the Goodyear family.”
Brad Hughes, Cooper president & chief executive officer, added, “Cooper has transformed into a dynamic, consumer-driven organization that has balanced traditional and emerging channels to increase demand for our products, while updating and effectively leveraging our global manufacturing footprint. I am extremely proud of what our team has accomplished over the past 107 years and am grateful to our talented employees for their contributions and commitment. This transaction marks the start of a new chapter for Cooper, which we are entering from a position of strength. We believe that it represents an attractive opportunity to maximize value for our shareholders, who will receive a meaningful premium as well as the opportunity to participate in the upside of the combined company. We look forward to the opportunity to combine Cooper’s considerable talents with Goodyear’s, and to be part of a bigger, stronger organization that will be competitively well-positioned to win in the global tire industry.”