ERJ staff report (TB)
Quincy, Illinois -- Titan Tire Corp. has completed its acquisition of Goodyear's Latin American farm tyre business for approximately $98.6 million, subject to post-closing conditions and adjustments.
The transaction includes Goodyear's Sao Paulo, Brazil, tyre plant, property, equipment and inventories and a licensing agreement that will allow Titan to sell Goodyear-brand farm tyres in Latin America and North America.
Titan's proposed purchase of Goodyear's farm tyre assets in Europe is still pending as Goodyear works through the closing requirements, Titan said.
â€œOver 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,â€ said Maurice Taylor, chairman and CEO of Titan Industries Inc., parent of Titan Tire.
â€œThis expansion into Latin America supports our global vision of becoming the world's premier farm tyre manufacturer.â€
Revenue generated by the Sao Paulo plant is running at approximately $250 million annually, Titan said, split roughly 50:50 between farm product sales and non-agriculture products that Titan will build for Goodyear under supply agreements.
The 72-year-old Sao Paulo factory produces light and medium truck tyres in addition to farm and OTR tyres. Capacity is listed as 4,500 units a day with 600 employees.
Goodyear agreed to sell its European and Latin American farm tyre businesses to Titan last December after having them for sale since May 2009. Titan bought Goodyear's North American farm tyre business, including a plant in Freeport, Illinois, in 2005.
The European portion of the transaction include the plant, property, equipment and inventories of Goodyear's Amiens North factory in France. The deal depends on Goodyear's being able to complete a social plan at the plant related to the previously announced discontinuation of consumer tyre production at that site.
From Tire Business (A Crain publication)
Press release from Goodyear
Press release from Titan