Cooper Tire “firmly committed” to Apollo merger
In an SEC filing yesterday, Cooper Tire & Rubber Co. said it will continue to press ahead on its $2.5 billion merger with India-based Apollo Tyres.
The filing said, “Both Cooper Tire and Apollo remain firmly committed to the strategic rationale” of the merger
Last week, an arbitrator ruled in favor of the United Steelworkers union, which had filed a grievance that its collective bargaining rights were violated when Cooper entered the deal with Apollo in June. The arbitrator said Cooper’s two U.S. plants with union membership could not be sold until an agreement had been reached with the union. The union covers about 2,500 employees at Cooper’s Findlay, Ohio, and Texarkana, Ark. plants.
Cooper’s Tupelo manufacturing plant, which employs about 1,300, is not unionized.
Read Cooper’s SEC filing after the jump:
As previously disclosed by Cooper Tire & Rubber Company (“ Cooper Tire ”), on August 1, 2013 the United Steelworkers and two of its local unions (collectively, the “ Unions ”) which represent employees at Cooper Tire’s Findlay, Ohio plant and Texarkana, Arkansas plant filed grievances alleging that Cooper Tire violated the successorship provisions of the collective bargaining agreement applicable to each plant by entering into the Agreement and Plan of Merger, dated June 12, 2013, with wholly-owned subsidiaries of Apollo Tyres Ltd. (“ Apollo ”) whereby Cooper Tire agreed to merge with a wholly-owned subsidiary of Apollo (the “ Merger ”). The Unions agreed to binding arbitration regarding this dispute, and the arbitration hearing took place on August 28, 2013. On September 13, 2013, the arbitrator ruled in favor of the Unions and ordered Cooper Tire to refrain from selling or transferring the Texarkana and Findlay plants unless and until the Unions have entered into agreements with an Apollo subsidiary that recognize the Unions as the bargaining agents and establish the terms and conditions of employment to be effective as of the closing of the Merger.
Cooper Tire is assessing its options related to this decision. At the same time, Cooper Tire and Apollo are continuing discussions with the Unions with an aim of reaching an amicable resolution quickly to minimize any impact on the original closing schedule. Both Cooper Tire and Apollo remain firmly committed to the strategic rationale for the Merger, which will create a leader in the tire industry with a strong presence in the world’s largest tire markets and in the fastest growing geographies, and are optimistic that a mutually beneficial settlement can be reached.