Sale of Goodyear Latin America agri tyre business completed
The sale of Goodyear’s Latin America agricultural tyre business to Titan Tire was completed on April 1. Goodyear reports completing the sale for approximately US$99 million, subject to post-closing conditions and adjustments. The transaction includes the company’s Sao Paulo manufacturing plant, property, equipment and inventories and a licensing agreement that will allow Titan to sell Goodyear-brand agricultural tyres in Latin America and North America.
“This transaction reinforces our focus on targeted market segments,” said Richard J. Kramer, Goodyear chairman and chief executive officer. “Our Latin American farm tyre operations have been very successful for many decades. I’m confident this will continue and that Titan will maintain our strong relationships with Goodyear farm tire customers.”
Goodyear announced agreements to sell its Latin American and European farm tire businesses to Titan in December 2010. The European portion of the transaction has not yet been completed. Assuming the European portion of the transaction is completed, Goodyear’s operating results, excluding any gain or loss on the sales, are not expected to be materially affected, although the impact on segment operating income will vary by region. Total revenue from the Sao Paulo plant is running at approximately $250 million annually, which includes approximately $125 million of farm product sales and approximately $125 million worth of non-agriculture product that Titan will build for Goodyear under supply agreements.
Titan chairman and CEO Maurice M. Taylor added: “We are very excited to have purchased these great assets for Titan. Over the next 18 to 24 months, we believe Latin America revenue can grow up to approximately $400 million by adding OTR radials and other earthmover and construction tyres to the facility. This expansion into Latin America supports our global vision of becoming the world’s premier farm tyre manufacturer.”