It’s the tire company merger soap opera that never ends.
Last week, Cooper Tire and Apollo Tyres traded swipes at each other, shortly after Cooper asked a Delaware Chancery Court to force Apollo to quit dragging its feet on their proposed $2.5 billion merger.
On Monday, Apollo filed a counterclaim saying that Cooper hasn’t been doing what it’s supposed to be doing to seal the deal. But, Apollo insists it still wants a merger.
Apollo Tyres Ltd yesterday filed its answer to the complaint filed by Cooper Tire & Rubber Company in the Delaware Court of Chancery on October 4, 2013 as well as a counterclaim.
In its answer, Apollo denied the allegations made by Cooper regarding the course of its negotiations with the United Steelworkers and confirmed that it has worked diligently to reach a settlement with the United Steelworkers to enable Cooper to overcome the United Steelworkers injunction prohibiting Cooper from consummating the merger. Apollo also asserted affirmative defenses, including that conditions precedent to closing had not been satisfied because the marketing period for the financing, central to Cooper’s claims in its complaint, had never commenced and that Cooper has failed to meet its contractual obligations under the merger agreement.
Apollo also filed a counterclaim seeking a declaratory judgment that the conditions precedent to the closing of the merger have not been satisfied. Apollo’s response details Cooper’s failures to provide information required to be provided under the merger agreement due in part to its lack of control of its Chinese subsidiary, Cooper Chengshan Tire (CCT), as well as Cooper’s breach of several representations, warranties and covenants in the merger agreement.
Apollo reaffirms that it believes that a merger with Cooper is strategically compelling and that it continues to work diligently to address the various post-announcement impediments preventing Cooper from consummating the merger.