This buy, although, is notably vital for a way a lot traction it provides Goodyear in China, which collectively with the United States accounted for a couple of third of the worldwide manufacturing of tires in 2019. China is additionally the world’s largest automotive market, and an more and more engaging vacation spot for gamers in the auto trade to place down roots.
“In China, the combination nearly doubles Goodyear’s presence and increases the number of relationships with local automakers,” the businesses mentioned in an announcement.
Shares of Goodyear and Cooper each soared Monday after the information. They every completed the day up greater than 20%.
While Goodyear and Cooper are the 2 largest tire producers in the United States, they lag behind rival producers in market share and model recognition in China.
The corporations additionally mentioned that the deal “further strengthens Goodyear’s leading position in the [United States], while significantly growing its position in other North American markets.”
Goodyear can pay Cooper’s shareholders in each money and shares and fund the money portion via debt financing.
The transaction is anticipated to shut in the second half of this 12 months, the corporate mentioned.