Page 6 - RB-66-13-3

NEWS
Apollo Tyres to Acquire Cooper Tire & Rubber Company
Apollo Tyres Ltd and Cooper Tire & Rubber Company have announced the execution of a definitive merger agreement under which a wholly-owned subsidiar y of Apollo will acquire
The combined company will be the seventh-largest tyre company in the world and will have a strong presence in high-growth end-markets across four continents. With a combined
$6.6 billion in total sales in 2012, the combined company will have a full range of brands and greater ability to satisfy customer needs worldwide. The combination is expected to deliver value creation benefits of approximately Rs 465-700 crores (US$80- 120 million) per annum at the EBITDA level. These ongoing
benefits are expected to be fully achieved after three years and derived from operating scale, sourcing benefits, technology, product optimisation, and manufacturing improvements. The transaction is expected to be immediately accretive to Apollo’s earnings.
Onkar S Kanwar, Chairman, Apollo Tyres Ltd, stated, “This transformational transaction provides an unprecedented opportunity to serve customers across a host of geographies in both developed and fast-growing emerging markets around the world. Cooper is one of the most respected names in the tyre industr y, with an extensive distribution network and manufacturing infrastructure, and a particularly robust presence in North America and China. The combined company will be uniquely positioned to address large, established markets, such as the United States and the European Union, as well as the fast-growing markets of India, China, Africa, and Latin America where there is significant potential for further growth. Our combined portfolio of brands and products will be amongst the most comprehensive in the industr y.”
Roy Armes, Cooper’s Chairman, Chief Executive Officer and President, said, “This is a compelling transaction that is in the best interest of Cooper’s stockholders and offers attractive
benefits to our customers and employees. We have watched Apollo’s successful transformation into a major global tyre group, and have a great deal of respect for the company and its leadership. Together, our two organisations have almost no geographic overlap and there are significant opportunities for growth. We share a commitment to innovation, quality, and customer service, as well as to the core values of safety, environmental sustainability, the development of our people and giving back to our communities. We look forward to working together to drive continued growth in a dynamic global tyre business where increased scale and expanded manufacturing footprint help to ensure long-term success.”
Neeraj K anwar, Vice Chairman and Managing Director, Apollo Tyres Ltd, said, “The combined company’s diversified product offering will serve the passenger car, light and heavy truck, farm, and off-the-road vehicle segments. Our extended global reach will create opportunities to provide our customers and distributors around the world with increased access to the quality tyres they have come to expect from each of our respective brands.
Together, we will have a significant presence in each of the three largest automotive markets in the world, namely the United States, Europe and China.”
Neeraj K anwar added, “Importantly, both Apollo and Cooper have built strong reputations on the strength of their people, and this transaction will maintain the networks and workforces in each organisation’s respective regions, while creating new opportunities in others. We are excited by the possibilities created by our partnership and look forward to welcoming Cooper’s employees to the Apollo family.”
The close of the transaction, assuming timely regulatory approvals and other customary closing conditions, as well as approval by Cooper’s stockholders, is expected to take place within the second half of 2013. Following the close, Cooper will become a privately held company and its common stock will no longer be traded on the New York Stock Exchange. It is expected that Cooper will continue to be led by members of its current management team and will continue to operate out of its facilities located around the world. Cooper will continue to recognise the labour unions and honour the terms of collective bargaining agreements presently in effect while generally maintaining compensation and benefit levels for non-union employees.
Onkar S Kanwar, Chairman and Neeraj Kanwar, Vice Chairman and Managing Director
Cooper in an all-cash transaction valued at approximately Rs 14,500 crores (US$2.5bn). Under the terms of the agreement, which has been unanimously approved by the boards of directors of both companies, Cooper stockholders will receive $35.00 per share in cash. The transaction represents a 40 per cent premium to Cooper’s 30-day volume-weighted average price. This strategic combination will bring together two companies with highly complementary brands, geographic presence and technological expertise to create a global leader in tyre manufacturing and distribution. Apollo,
founded in 1972, has an international reputation for high performance tyres across a portfolio of well-known
premium and mid-tier brands, including the flagship Apollo brand and Vredestein. Cooper, the 11th-largest tyre company in the world by revenue, was founded in 1914 and today supplies premium and mid-tier tyres worldwide through renowned brands such as Cooper, Mastercraft, Starfire, Chengshan, Roadmaster and Avon. This deal also includes Cooper’s retread operations and rubber supplies, in Melksham, UK, plus its operations in Turkey. Thus, Apollo have not only become the 7th largest tyre manufacturer, they now have interests in the European retread sector too.
Kraiburg Workers Released For Flood Relief Operation
Kraiburg Austria recently released 10 members of staff to join the relief operations in flooded areas of the region. The fire service is witnessing floods only seen every 100 years or every 30 years at the surrounding Inn, Mattig and Salzach rivers. The site of the retread specialist is not actually located by one of the rivers and, as such, is not directly affected. However, many other buildings and private households are experiencing major flooding.
"This kind of neighbourly gesture comes naturally to us and would be the typical response of many businesses in the region", commented Director Thorsten Schmidt. "Our staff have been doing a tremendous job, whether they are helping with relief organisations or trying to remedy problems with their own houses. We hope that the water level will soon recede and that people's lives will not be under such great threat".
6 Retreading Business