Editor's note: FleetOnwer, a part of IndustryWeek's parent company Endeavor Business Media, published this update of the Goodyear/Cooper merger.
Two titans of tires are teaming up. Goodyear Tire & Rubber Co. announced February 22 it had landed an agreement with Cooper Tire & Rubber Co. to purchase it for $2.5 billion.
Akron, Ohio-based Goodyear, which employs about 62,000 people in 46 factories across the world, will acquire Cooper’s 10 factories, which collectively employ about 10,000 people, as well as Cooper’s self-named, Mastercraft, Roadmaster and Mickey Thompson tire brands.
The deal will enable Cooper tires to be sold through Goodyear’s existing network of retailers while almost doubling its presence in the Chinese market, where demand for automobiles in the waning days of the pandemic is growing. The companies also expect that they will be able to save about $165 million in administrative costs within two years of the deal closing as overlapping corporate functions get consolidated.
Goodyear CEO Richard Kramer called the deal “transformational” for the companies. In a statement, Kramer said, “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.”
Cooper CEO Brad Hughes said he was “extremely proud” of Cooper’s 107-year history and called the acquisition the “start of a new chapter for Cooper.”
“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,” said Hughes.