US-based Cooper Tire has reached tentative agreements with worker unions of its manufacturing facilities aimed at helping it close the $ 2.5 billion merger agreement with Apollo Tyres.
“Cooper has reached tentative agreements with the unions representing employees at our Findlay, OH and Texarkana, AR plants relating to the Apollo transaction,” Cooper Tire & Rubber Company Vice President, Communications & Public Affairs, Anne Roman, told PTI in an e-mailed response.
Ms. Roman, however, did not share the details of the tentative agreements but said “Cooper remains committed to the strategic merit of the pending merger. The trial remains scheduled in Delaware Chancery Court November 5-7”.
In a SEC filing, Cooper said: “Details of the tentative agreements are not being disclosed pending review and consent by Apollo. The tentative labour agreements are also subject to review and ratification by union membership.”
When contacted a spokesperson of Apollo Tyres declined to comment.
Expressing optimism about closing the transaction, Ms. Roman said: “We moved forward with negotiations and the tentative agreements as part of our continuing efforts to do all we can to close the transaction with Apollo as soon as possible.”
According to the SEC filing, Cooper Tire has also entered into a waiver agreement with the Unions, which among other things, provides that the tentative labour agreements reached with the union in certain cases satisfy the arbitrator’s ruling so long as the merger closes on or before November 18, 2013, even if such agreements are not yet ratified by union membership at that time.
In August, the unions which represent employees at Cooper Tire’s Findlay, Ohio plant and Texarkana, Arkansas plant had filed grievances alleging that the company violated the successorship provisions of the collective bargaining pact applicable to each plant by entering into the Agreement and Plan of Merger, dated June 12, 2013, with wholly-owned subsidiaries of Apollo Tyres.
The unions agreed to binding arbitration regarding this dispute. On September 13, 2013, the arbitrator ruled that an Apollo subsidiary must reach agreements with the Unions before the merger may close.
Last month, Apollo had sought price reduction in the $ 2.5 billion deal citing problems related to the US firm’s operations in China and concessions to workers’ union but was rejected by Cooper.
The US firm had alleged that the Indian firm was seeking to delay an agreement with United Steelworkers (USW).
In June, Apollo had announced to acquire Cooper Tire & Rubber Co in an all-cash transaction valued at around $ 2.5 billion (nearly Rs 14,500 crore).