Bandag
Bridgestone Americas Holding Inc.’s US$1 billion acquisition of Bandag Inc. has received early approval from the US Federal Trade Commission (FTC). The FTC ended a required 30-day waiting period for the acquisition ahead of schedule, on January 29, announced Bandag in a prepared statement. The 30-day period was not scheduled to end until February 8.
Well-known Saudi Arabian tyre specialist General Retread has entered into a partnership with Bandag to launch precure tyre retreading in the Kingdom of Saudi Arabia. This is a virgin market for Bandag.
A number of Bandag Inc. shareholders have reportedly filed a lawsuit against the retreading supplier for allegedly failing to seek offers of purchase from potential buyers other than Japanese tyre giant Bridgestone. The lawsuit was filed in the District Court in Bandag’s hometown of Muscatine County, Iowa on December 8 by the Plumbers and Pipefitters Local 572. They are seeking class action status on behalf of all shareholders.
Following the news of Bandag’s sale to Bridgestone, Continental AG CEO Manfred Wennemer told journalists that a strategic acquisition of Bandag would have been too expensive and did not fit into the company’s strategy. Speaking to a group of journalists, Wennemer added: “Retreading is not core business for Continental.” While company executives may be trying to distance Continental from the retreading side of the commercial vehicle business, the exact effect Bridgestone’s acquisition will have on Continental’s partnership with Bandag remains to be seen.
(Akron/Tire Review) Bridgestone Corp. said yesterday that it will use a bank loan to facilitate Bridgestone Americas Holding’s acquisition of Bandag Inc., announced earlier this week. BAH is buying the retreading giant for $1.05 billion in cash, with Bandag becoming an operating subsidiary of BAH. The deal is expected to close by mid-2007.
After several attempts they have now finally succeeded: Bandag Corporation heir, Martin Carver, has sold his and his mother’s majority stake in the company to Japanese tyre giant Bridgestone. It was probably high time for the American retreading specialist to make such a move, as in recent years they have been operating in a seemingly unfavourable environment. If Bridgestone had also chosen to go down the same path as Goodyear and Michelin, establishing its own equity retreading businesses, Bandag’s market environment could have been set to become even more unfavourable.
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Bridgestone shares rose three and a half per cent to 2,550 yen, the greatest gain in two months, after the tyremaker agreed to purchase retreaders Bandag Inc.
After several attempts they have now finally succeeded: Bandag Corporation heir, Martin Carver, has sold his and his mother’s majority stake in the company to Japanese tyre giant Bridgestone. It was probably high time for the American retreading specialist to make such a move, as in recent years they have been operating in a seemingly unfavourable environment. If Bridgestone had also chosen to go down the same path as Goodyear and Michelin, establishing its own equity retreading businesses, Bandag’s market environment could have been set to become even more unfavourable.
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Bridgestone’s North American subsidiary, Bridgestone Americas Holding (BSAH), has bought Bandag Incorporated for US$1.05 billion. The deal sees the two companies enter into a merger agreement pursuant to which BSAH will acquire the outstanding shares of each class of Bandag stock for US$50.75 per share in cash. Bandag’s Board of Directors unanimously approved the agreement. The transaction is expected to be completed late in the first quarter or early in the second quarter of 2007, subject to the receipt of shareholder and regulatory approvals and the closing conditions. In 2005 Bandag had worldwide sales of US$921 million.
Ulu Lastik Kaplama has become Turkey’s latest Bandag shop. The Bandag retreads produced and delivered by Ulu Lastik Kaplama are designed to help fleets reduce their tyre budget while increasing vehicle uptime. Owner Halil Ulu and his sons Menderes Ulu have more than 15 years of experience in truck tyre servicing.
Ideally situated on the main road of Denizli, the tyre shop is within easy reach of the national road network and offers all tyre related services: wheel alignment, balancing, repair and fitting of truck and OTR tyres. The clear predominance of road transport and the retread ratio of 25 per cent in the region convinced Halil Ulu and his sons to opt for the only retreading system that really cuts tyre operating costs.
Headquartered in Heusenstamm, Germany, Baake GmbH & Co. KG is celebrating 35 years as a Bandag franchisee. In recognition of the long relationship, Karl Robert Baake, general manager, was presented with a commemorative plaque by Mike Tirona, vice president and general manager of Bandag EMEA.
Although the franchise contract was signed in 1971, Baake’s proud history stretches back to 1932, when the company began life as a tyre curing shop. The knowledge gained here proved a valuable asset after WW II when it integrated hot-cap retreading of car tyres into the business.
Ehrhardt Reifen + Autoservice was founded 60 years ago, soon after World War II in Wulften, Germany, now the company is celebrating 20 years as a Bandag dealership. Owner and general manager Rolf Ehrhardt already represents the third generation of the family. The Ehrhardt Group runs 26 commercial outlets scattered over the federal states of Niedersachsen, Thüringen, Sachsen-Anhalt, and Hessen. The company ranks among the largest distributors of automotive parts in the region. In addition to a wide range of tyres for cars, trucks, OTR and AG, Ehrhardt sells and services batteries, exhausts, brakes and rims.
German tyre distributor Reifen Lindiger has been producing Bandag retreaded tyres since 1971. In May, Bandag honoured its loyal partner and celebrated the 35th anniversary of this ongoing business relationship. Christian Gross, production manager, was presented with a commemorative plaque from Ralf Schnelle, Bandag regional sales manager on the Bandag stand at Reifen Messe, the biennial tyre fair in Essen, Germany. Reifen Lindinger is located in the centre of St. Ingbert, Saarland, Germany. The company is a member of Point-S Deutschland, a cooperation of over 200 independent tyre distributors, totalling more than 350 service outlets. Founded in 1921 by Adolf Lindinger as a tyre curing, repair shop and wholesaler, the family company is currently run by Ulrich Ernst, the son-in-law of Karl-Heinz Lindinger, the founder’s sons.
According to Kraiburg Austria, 2006 marks the centenary of retreading and, the company argues, giving new life to worn tyres is as important today as ever it was. The experts are not in total agreement, but many are of the opinion that the retreading of tyres started in 1906 in Germany, while 1908 is the year cited for England and China, and 1917 for the USA.
Bandag, Inc. was able to increase its turnover in the third quarter to $260.2 million; up by 5.2 per cent compared to the second quarter of this year and reaching a new record high. Compared to the same quarter last year turnover grew by 6.1 per cent. However, net income plummeted by 50.8 per cent. Bandag, Inc. based in Muscatine, Iowa, only achieved a net income of $9.2 million compared to $18.7 million for the same quarter last year. This net income equals a 3.5 per cent margin on Bandag’s turnover. Compared to the previous quarter the net income only fell by 12.4 per cent from $10.5 million. Obviously Europe remains the problem, as can be read up in Bandag’s current quarter report.
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