In an attempt to liquidate some cash Goodyear Tire & Rubber Co. has said that it will “commence an offering of approximately $150 million aggregate principal amount of convertible notes, subject to market and other customary conditions.” The company intends to use the proceeds of the sale for what it calls “general corporate purposes”, which includes “the repayment of one of the company’s revolving credit facilities.”
Only hours after announcing that it would offer a $150 million aggregate principal amount of convertible notes, Goodyear has said that it is doubling the total amount available to $300 million
The German tyre manufacturer Continental AG has to wait for another two weeks before they hear whether or not the European Commission will approve the take-over of automotive supplier, Phoenix. The Commission says that the legal examination will be completed by 29 June but did not give any reasons for the extension of the deadline.
At the end of April Continental started the take-over bid of its Hamburg based competitor. In the middle of last week Continental acquired the majority of the Phoenix shares.
On 10 June Continental announced that it had reached the 50% mark in its planned takeover of Phoenix. “With 50.02% we have already attained a majority interest and feel that our confidence in procuring over 75% of the shares as targeted has been affirmed,” said Manfred Wennemer, chairman of the Continental executive board.
The company believes that the proposed merger of the two companies is good “industrial logic” and that it has offered Phoenix shareholders a good price. Following sales of around 1.8 billion in 2003 Continental’s ContiTech division see the move as a step towards strengthening its position as one of the world’s leading rubber and plastic technology specialists.
SmarTire Systems Inc. (OTCBB: SMTR) announced that the Company has signed a $15 Million Standby Equity Distribution Agreement with Cornell Capital Partners LP. This financial instrument replaces the $15 Equity Line of Credit arranged by HPC Capital Management in 2003. SmarTire also announces that it has arranged a second $750,000 unsecured, promissory note with Cornell Capital.
The Japanese tyre manufacturer has reported good 1st quarter figures. Demand was better than expected, exports are booming and price increases seem to have stuck. All reasons for Deutsche Bank to recommend the shares as a “buy”.
While the Goodyear shares jumped around 5 per cent to 8.56 US-Dollars on the stock exchange, finance experts have reacted more cautiously. Rod Lache, DB-analyst in New York, doubts whether the contract with the unions or the closing of a factory in the USA last year is sufficient to have a positive effect on the high fixed costs. He expressed surprise that Goodyear’s volumes slipped by 1.7 per cent while the industry gained 3.7 per cent. The value of Goodyear shares is in the region of 6 US-Dollars, according to Deutsche Bank.
More than 50,000 new Nokian shares have been subscribed, adding 104,070 Euro to the company’s share capital, which now totals 21,472,952 Euros. The shares, together with the old shares, will be traded on the Helsinki Exchange from 17 May.
Goodyear Tire & Rubber is seeking an extension from regulators to file its quarterly report. The company said it plans to file the report by mid-June. As reported, the firm last month restated its net income for 1997 through 2003, less 65 million US dollars. Shares closed at 8.22 dollars, down 22 cents.
Analysts MorganStanley have upgraded Nokian shares from “Underweight-V” to “Equal Weight-V”. This follows good first quarter financial figures and the company’s reorganised strategy to pursue growth in the Russian tyre market, which involves investing 52 million Euro in building a new factory near St. Petersburg.
VW, which has warned that its 1Q results would be bad, was hit further yesterday when it recalled 870,000 Passats, Audi A6 and A8 models. The worldwide recall is because of a possible fault to the cars’ front axles. The news affected the company’s share price, which at one stage fell by two per cent.
Titan International is to purchase 4.9 million shares of Titan International common stock from Citicorp Venture Capital (CVC). This represents around 23 per cent of the total shares outstanding and the purchase price is US$ 15 million.
This week Volkswagen announced that it will acquire half of Dutch car lenders, Lease Plan. The remaining 50% will be held by the state-owned Mubadala Development Company, Abu Dhabi and the Greek Olayan Group. The deal, which will cost §1 billion, will see VW reissue 26.3 million treasury shares in order to finance the deal.
Goodyear Dunlop Tires Europe has strengthened its position in Scandinavia with an agreement to buy the outstanding shares of one of Sweden’s major retail tyre groups, Däckia. The company expects to complete the purchase of the chain by the end of June. Goodyear Dunlop currently owns 50 per cent of the shares with the remaining being primarily owned by Procuritas (26%) and Däckia management (24%). Financial terms of the deal were not disclosed. Däckia has more than 60 company owned stores, as well as 31 contract partners in cities throughout Sweden, with annual sales revenue of approximately $65 million. Däckia is widely regarded as one of the most successful tyre retailers in the Nordic Region.
Pirelli has exercised its option to acquire 0.46 per cent of the capital of Telecom Italia, the telecomunications group. The transaction involves the purchase of over 47 million ordinary shares at a price each of 2.12 Euro.
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