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Cooper Tire calls off deal with Apollo Tyre

Dec. 30, 2013 at 2:36 PM   |   Comments

FINDLAY, Ohio, Dec. 30 (UPI) -- Cooper Tire said Monday it would no longer pursue closure on a $2.2 billion deal to sell itself to India's Apollo Tyres.

The deal, which was announced in June, hit snags almost as soon as it was announced, the Wall Street Journal reported.

Within a week of the announcement, the head of a Cooper subsidiary in China took out ads in newspapers stating his opposition to the deal.

By August, the factory had stopped shipping Cooper brand tires. Concurrently, the United Steelworkers union said the deal allowed it to renegotiate their Cooper Tire contract, a point that was held up by a labor mediator in mid-September.

In October, Cooper took Apollo to court claiming it was using the negotiations with the union as a way to avoid closing the deal.

Papers filed in court claim that a various parties, including Apollo's financial advisers at Morgan Stanley were advising the company to stall to derail the deal.

"What would prevent [Apollo] from taking a very difficult position with the USW and then watching the clock run out to the end of the year? In other words, does [Apollo] now have an out to the deal?" asked banker William Dotson in court filings.

The lawsuit now changed direction, the newspaper said. Instead of suing to push Apollo to close the deal, it becomes a lawsuit seeking damages.

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