Titan Buyout Deal Surprises USW

Akron/Tire Review – Freeport Journal Standard) The $18 per share “cash merger” offer by an New York private equity firm for Titan International apparently caught the United Steelworkers (USW) well off guard, leaving the national union and its Freeport, Illinois, local scrambling for information.

Titan announced Oct 11 that received an offer from One Equity Partners LLC, a private equity affiliate of JPMorgan Chase & Co., indicating One Equity’s interest in acquiring Titan International in a cash merger for $18 per share of Titan common stock. Titan has about 19.4 million shares outstanding.

Titan has been in contract negotiations with the local union since coming to an agreement 28 February with Goodyear Tire & Rubber Co. to acquire its North America farm tire business, including the Freeport plant, for approximately $100 million. As dictated by the current labour contract with Goodyear, the sale cannot be finalised until Titan negotiates a new deal with the union. The union’s current contract with Goodyear is set to expire in June 2006.

Information regarding the possible merger was passed on to the local Kelly-Springfield plant on Wednesday morning, according to Steve Vanderheyden, president of United Steelworkers of America Local 745. Vanderheyden said the union has engaged the help of the national Steelworkers leadership to assess the situation.

”We have had no dialogue with them (Titan) about it,“ Vanderheyden said. ”We passed the information along to Pittsburgh for Wayne Ranick (spokesperson for the United Steelworkers of America) to look at, to see if it has any implications for us.“

The last negotiating session between Local 745 and Titan ended uneventfully 30 September, resulting in an extension of the previous 1 October deadline to 1 November. The two sides are still trying to schedule the next meeting, which has been difficult with Titan also negotiating with its Local 164 workers in Des Moines, Iowa.