Goodyear Union City plant changes hands for $9M
Titan International has confirmed its subsidiary Titan Tire Corporation paid “approximately US$9 million” for the physical assets of the Goodyear tyre plant in Union City, Tennessee, which closed in July 2011. Included in the purchase are around 480 acres of land and a 2.1 million square foot building. As part of the deal, Titan has agreed not to produce radial passenger car or 4×4 tyres at the factory and to scrap all curing presses and tyre building equipment that Goodyear requests to be scrapped. Titan will retain the scrap value of these items.
Although the acquisition agreement gives Titan immediate access to the site to allow inspection of the condition of all banbury equipment and steel and fabric calendar lines, Goodyear has until June 2012 to remove the equipment it wishes to retain. Company employees and its contractors will also be granted access to the facility to remove retained equipment.
“Titan has not yet decided how it plans to utilise the Tennessee location except to warehouse farm and OTR tyres and to have a single equipment rebuilding operation for the machines,” commented Maurice Taylor, chairman and CEO of Titan International. “The decision on whether Titan will keep the equipment in Union City or move the equipment to other Titan tyre factory locations will not be made until mid 2012. The mixing capacity with the equipment Titan purchased could allow an additional $1 billion in future sales and increase Titan’s output of farm and OTR tyres going forward when, as stated, a decision is made. This transaction happened fast so we have a lot of work to do to see what gives Titan the largest savings.
“Titan paid Goodyear approximately $9 million for this acquisition, but we do not know yet how much we will get back from all the scrap machinery,” Taylor added. “I appreciate there have been a lot of comments on this acquisition but until we have decided exactly what we plan to do this is really all we can say.”
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