09 November 2013 00:27 [Source: ICIS news]
HOUSTON (ICIS)--US-based Cooper Tire expressed disappointment after a Delaware judge decided that India’s Apollo Tyres did not breach its obligation to expeditiously reach an agreement with a US union as part of the companies’ agreed-to merger.
“Cooper is assessing its options with respect to this decision and awaits the court’s ruling on other open matters in this case,” the US tyre maker said in a statement issued late Friday.
The judge in the case said he would rule by 13 November on whether Cooper can force Apollo to accept the agreed-to deal of $35/share.
Apollo said in a media statement that it was pleased with Friday’s ruling and looked forward to “finding a sensible way forward”.
Cooper has accused Apollo of delaying an agreement with a US union as the India-based company seeks to lower the per-share price of the merger.
Cooper stockholders approved the tyre manufacturer’s $2.5bn (€1.9bn) merger with Apollo in September after a deal was reached in June. The deal was agreed to be an all-cash transaction, with Cooper stockholders receiving $35/share in cash, a 40% premium to Cooper’s 30-day volume-weighted average price.
But Cooper has argued that Apollo has breached the acquisition contract by working for a lower per-share price based on situations with contract negotiations with United Steelworkers in the US as well as a strike involving a Cooper joint venture in China with Chengshan Group.
Apollo has disputed the allegations and said it “has worked diligently with the United Steelworkers to enable Cooper to overcome the United Steelworkers injunction prohibiting Cooper from consummating the merger”.
The Indian company said Cooper failed to provide required information under the merger agreement due in part to its lack of control of the Chengshan joint venture and has breached other parts of the agreed-to deal.
Both companies maintain that they would like to resolve their issues and complete the merger, which both have said would result in the world’s seventh-largest tyre manufacturer.
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