Goodyear and Cooper announced they have entered a definitive transaction agreement under which Goodyear will acquire Cooper in a cash-and-stock transaction with a total enterprise value of approximately $2.5 billion. The transaction will expand Goodyear’s product offering by combining two portfolios of complementary brands. It will also create a stronger U.S.-based manufacturer with increased presence in distribution and retail channels while combining both companies’ strengths in the highly profitable light truck and SUV product segments. The combined company will have approximately $17.5 billion in pro forma 2019 sales.
We are confident this combination will enable the combined company to provide enhanced service for our customers and consumers while delivering value for shareholders. The transaction has clear and compelling industrial logic – it will deliver:
- A stronger position in the global tire industry, with expanded leadership in the U.S., significantly increased strength in other North American markets and a near doubling of our presence in China;
- Expanded ability to serve customers and consumers with a combined portfolio of complementary brands across the value spectrum, including enhanced depth in the highly profitable light truck and SUV product segments;
- A stronger financial foundation with greater resources, an improved balance sheet and increased opportunities for earnings and growth;
- Opportunities for expansion of select Cooper facilities will increase capital efficiency and flexibility; and
- Increased scale to support investments in new mobility and fleet solutions.
Goodyear and Cooper are a strong cultural fit. We expect that our similar cultures will be an important asset, supporting a successful integration with a best-of-both worlds philosophy and ensuring continuity of manufacturing, operations and customer service.
Acquiring Cooper enhances Goodyear’s core business in an evolving industry, while providing greater financial flexibility and scale to invest in growth areas. These areas include our mobility strategy and our relationships with OEs, autonomous driving system developers, fleet operators and other mobility platforms.
This is exciting news for Goodyear and Cooper customers and consumers. With the addition of Cooper, Goodyear will be a stronger partner for our customers and even better able to serve the unique needs of drivers.
The transaction will leverage the respective strengths of both companies to provide our customers:
- Expanded product offering. The blending of these complementary brands will create a comprehensive portfolio that fully covers the premium, mid and lower tiers.
- Combined strength in light truck and SUV. The transaction will harness the companies’ shared strength in light truck and SUV products to better serve this highly profitable segment.
- Greater manufacturing capabilities. The addition of Cooper will create opportunities to expand select Cooper facilities to increase capital efficiency and flexibility.
- Enhanced service. Our combined assets will further enhance service for our customers.
As a result, consumers will have more choices and be able to buy more Goodyear products in more locations.
This transaction is about creating a stronger U.S.-based leader in the global tire industry by uniting two companies with rich histories in our shared home state of Ohio, and strengthening and positioning the combined company for long-term growth, which ensures we’re positioned to create career opportunities and support communities where we operate. Today’s announcement is just the first step in a process. Until the transaction closes, which is expected in the second half of 2021, Goodyear and Cooper remain separate companies and competitors and nothing about the way we work changes.
After closing, the combined company will be headquartered in Akron, but Goodyear expects to maintain a presence in Findlay, OH. Like many companies, Goodyear is spending time thinking about the workplace of the future and we will continue to assess our corporate footprint. By strengthening and positioning the combined company for long-term growth, we will ensure our ability to continue supporting communities where we operate.
The transaction is subject to the satisfaction of customary closing conditions, including receipt of required regulatory approvals and the approval of Cooper shareholders. The transaction is expected to close in the second half of 2021.