No Deadline Extension for Titan-Goodyear Deal – Yet
(Akron/Tire Review) The deadline for Titan International to conclude its $100 million purchase of Goodyear Tire & Rubber Co.’s agricultural tyre unit has come and gone, with no word on the disposition of the deal.
Titan has twice extended the completion date for the deal, originally reached last February, because of slow moving negotiations between Titan and the United Steelworkers (USW) over a new contract for employees at Goodyear’s Freeport, Illinois, agricultural tyre plant.
Under terms of the contract it signed with Goodyear in 2003, any company purchasing a USW-represented Goodyear plant must negotiate a new deal with the union before the sale can be consummated.
The original termination date for the deal was 30 June, but both parties agreed in July to extend the deadline to 1 September. In early September, the deadline was moved to 1 October.
In February, Goodyear agreed to sell the assets of its agricultural group, including its farm tyre plant in Freeport, to Titan for approximately $100 million. The deal also gives Titan the right to produce and market agricultural tyres under the Goodyear brand name.
But because of the “successorship” provision in Goodyear’s master contract, the planned sale has not progressed as smoothly as either party would like. Shortly after the sale was announced, the USW, which has had a difficult relationship with Titan dating back to 1998, said the union was “far from optimistic that the necessary agreement will be reached to allow the sale to be finalized.” The Freeport plant employs some 800 hourly workers.
Before full-scale talks between Titan and the USW even began in early August, Titan president and CEO Morry Taylor told the local Freeport newspaper that Titan was not interested in protracted talks or costly union demands, and that he would rescind Titan’s purchase offer, allow the USW’s current contract with Goodyear expire, and then try to purchase the business again and convert the plant to a non-union facility.
“The options are to (negotiate) or to do nothing,” and let the contract expire and wait for Goodyear to decide the plant’s fate,” Taylor told the newspaper.
Meanwhile, strong rumours swirl that Titan has linked up with German OTR tyre retreader Roesler Group to make another run at purchasing Continental Tire North America’s (CTNA) OTR tyre plant in Bryan, Ohio.
Roesler Group’s tried to buy the plant earlier this year, but it also faced the same successorship clause in CTNA’s contract with the union. Roesler thought it had a deal with the USW, however the union rejected the contract proposal.