TEXARKANA, Arkansas -- Goodyear Tire & Rubber Co. has completed its acquisition of Cooper Tire & Rubber Co., finalizing the merger agreement made public in February.
"We are excited to officially bring Goodyear and Cooper together and unite our shared focus on customers, innovation and high-quality products and solutions," said Richard J. Kramer, Goodyear chairman, chief executive officer and president, in a press release. "This combination strengthens Goodyear's ability to serve more consumers globally and provides increased scale to support greater investments in new mobility and fleet solutions."
Kerry Halter, president of United Steelworkers Local 752L, said late Monday that he believes the Texarkana tire plant's $44 million expansion project underway will be an asset in Goodyear's new holdings.
"This expansion started before this merger was talked about, so that puts us in a good place to grow," he said.
A large part of the expansion project is automation of the curing department and automating more tire machines, which will allow the local plant to increase how many tires are built in a day.
Currently, the Texarkana plant produces about 30,000 tires daily.
The expansion project broke ground late last year and should be complete by the first part of next year, Halter said.
About 75 to 80 percent of the new building is up and it is in the dry, allowing the construction to pick up some speed.
The Texarkana plant has 1,550 employees and hiring is ongoing, Halter said.
In the local plant's collective bargaining agreement, there is successorship language. Specifically, a three-year clause in the agreement ensures fringe benefits and defined benefit increases employees will receive.
Goodyear officials are expected to tour the Texarkana plant late this week or early next week, Halter said.
"Employees are nervous. We've had this happen with Cooper possibly being bought out before and it never went this far. On paper it looks good for both Goodyear and Cooper," Halter said.
For instance, Cooper has a "pretty big portfolio" of replacement light truck tires that should put Goodyear in good standing. Also, the acquisition opens up a lot of distribution for Cooper as Goodyear has about 2,500 facilities, Halter said.
The Goodyear press release states the acquisition "unites two leading tire companies with complementary product portfolios, services and capabilities to create a stronger U.S.-based leader in the global tire industry. The combined company will offer more options across the value spectrum making it easier for customers and consumers to choose Goodyear- and Cooper-branded tires."
The acquisition is expected to be accretive to earnings per share within the first full year following closing, modestly improves Goodyear's balance sheet position and enhances the company's ability to de-lever, according to the press release.
Goodyear will integrate the best of Goodyear and Cooper in order to benefit its shareholders, customers, consumers and employees.
As a result of the closing, Cooper's common stock will cease to be traded on the New York Stock Exchange.
Goodyear, one of the world's largest tire companies, employs about 72,000 people and manufactures its products in 54 facilities in 23 countries around the world, according to the press release.