Cooper Tire Announces Plans to Acquire 100 Percent of JV / Joint Plant Investment in Mexico
2 November 2019
Cooper Tire & Rubber Company announced plans to increase its participation in the JV / joint investment in the tire manufacturing plant, Corporation of the West, SA de CV (COOCSA), from 58 percent to 100 percent. Cooper y Trabajadores Democráticos de Occidente SC de RL de CV (TRADOC), who own 42 percent of the joint investment, have entered into a definitive contract that establishes the terms under which Cooper will acquire TRADOC's stake in COOCSA. Today, most TRADOC members voted in favor of the agreement.
Subject to government approval and other closing conditions, the transaction is expected to be completed in early 2020. Meanwhile, plant operations, where tires for passenger cars and light trucks are manufactured, will continue normally. Since 2008, Cooper and TRADOC have been partners in the joint investment plant, which is located near Guadalajara.
"The total ownership of COOCSA is important within our strategic plan to optimize our global manufacturing presence with competitive production in quality tire costs to meet market demand, in this case in Latin America, as well as in North America," as well. expressed the President and CEO of Cooper, Brad Hughes. “We will continue to make investments to modernize the plant in the future as it produces millions of high quality tires. Cooper appreciates the efforts of TRADOC, our joint investment partner for the past 11 years, and we hope to continue working with them and with all those at the plant in the search for what we trust will be a successful future in Mexico. ”
This release contains what the company considers “forward-looking statements”, as said term is defined in the Private Securities Litigation Reform Act of 1995, regarding the projections, expectations or issues that the company expects to occur with respect to future performance of the industries in which it operates, the US economies. UU. and other countries, or the performance of the company itself, which implies uncertainty and risk. Generally, but not always, such forward-looking statements are preceded by words such as “expects,” “expects,” “will,” “should,” “considers,” “projects,” “intends,” “plans,” “estimates. ”, And other similar terms that denote a vision towards the future and are not themselves affirmations of historical data.
These forward-looking statements include, among others, statements regarding the planned acquisition by the company of TRADOC's participation in COOCSA, the time in which the transaction is expected to be completed, permits and regulatory approvals, synergies and the benefits that are They expect to obtain from the transaction, the company's planned investments in COOCSA, as well as expectations about future business plans and the expected performance and opportunities. There is no guarantee that the possible transaction will be consummated, and there are a number of risks and uncertainties that could cause the actual results to differ materially from the forward-looking statements made herein, including the time it will take to consummate the possible transaction. ,
In addition, actual results may differ materially from projections or expectations due to a variety of factors, including but not limited to:
- volatility in the prices of energy and raw materials, including those of rubber, steel, petroleum products and natural gas or the lack of availability of such raw materials or energy sources;
- the inability of the company's suppliers to supply the products and services in a timely manner in accordance with the specifications of the contract;
- variations in tariffs or trade agreements, or the imposition of new or increased tariffs or trade restrictions on tires, materials or manufacturing equipment used by the company, including variations in relation to tariffs on tires, raw materials and tire manufacturing equipment that is imported into the US UU. from China or other countries;
- changes in economic and commercial conditions in the world, including changes related to the decision of the United Kingdom to withdraw from the European Union;
- the inability to obtain and maintain price increases to compensate for the increase in production costs, tariffs or materials;
- the impact of the recently enacted tax reform legislation;
- increased competitive activity including actions by larger competitors and producers with lower costs;
- the inability to reach expected sales levels;
- changes in relations with suppliers or customers or distribution channels of the company, including the amortization of outstanding accounts receivable, or the loss of specific businesses due to competition, credit, liquidity, bankruptcy, restructuring or others;
- the inability to develop the technologies, processes or products necessary to support consumer demand, or changes in consumer behavior, including changes in sales channels;
- the costs and time of restructuring and deterioration actions or other changes that are generated from such actions, including the possible result of the recently announced decision to cease the production of tires for light vehicles in the United Kingdom, or events adverse in the industry, the market or others;
- consolidation or other forms of cooperation by and between competitors or customers of the company;
- the use of inaccurate assumptions in the development of the company's strategic plan or operational plans, or the inability or failure to implement such plans or to obtain the expected savings or benefits from strategic actions;
- risks related to investments and acquisitions, including the inability to integrate them successfully into operations or that their financing could have an impact on liquidity and capital resources;
- the final result of the litigation against the company, including claims of product liability, which could result in the dedication of time and substantial resources for defense, as well as possible material damages against the company or other unfavorable results;
- an interruption or failure of the company's technological information systems, including those related to cybersecurity, could adversely affect the business operations and financial performance of the company;
- regulatory and legislative initiatives by the government, including environmental, health care, tax and privacy issues;
- volatility in financial and capital markets or changes in credit markets and / or access to those markets;
- changes in interest rates or the exchange rate or in the indicators used to establish such rates;
- an adverse change in the company's credit ratings, which could increase borrowing costs and / or hinder access to credit markets;
- inability to implement information technologies or related systems, including the inability of the company to successfully implement ERP systems;
- the risks associated with conducting business outside the US UU .;
- technological advances;
- the inability to recover costs to renew existing products or to develop and test new products or processes;
- the impact of labor problems, including work interruptions in the company, its joint investments, or one or more of its large clients or suppliers;
- the inability to attract or retain key personnel;
- changes in pension and / or financing expenditure as a result of the company's pension strategy, the return on investments of the company's pension plan assets and changes in the assumptions related to the discount rate or the expected return on plan assets, or changes related to accounting regulations;
- changes in the company's relationship with its partners or joint investment providers, including any change with respect to the production of TBR products by its former joint investment with PCT;
- the ability to find and develop alternative sources for products supplied by PCT;
- a variety of factors, including market conditions, can affect the actual amount invested in share repurchases; the company's ability to consummate share repurchases; changes in the results of operations, financial conditions or strategic priorities of the company, may result in a modification, suspension or cancellation of share repurchases, which could occur at any time;
- the inability to adequately protect the intellectual property rights of the company; Y
- the inability to use deferred tax assets.
It is not possible to predict or identify all the above factors. Any forward-looking statement in this release is based on certain assumptions and analysis made by the company considering its experience and perception of historical trends, current conditions, expected events and other factors considered appropriate in view of the circumstances. Prospective investors are cautioned that such statements are not a guarantee of future performance and actual results or events may differ materially from those projected.
The company does not undertake to update any of the forward-looking statements included herein, or to disclose any fact, event or circumstance that could affect the accuracy of any forward-looking statement, except as required by law. The company's presentations to the US Securities and Exchange Commission. UU. (“SEC”) include additional information regarding those aspects that could substantially affect your financial performance.
About Cooper Tire & Rubber Company
Cooper Tire & Rubber Company is the parent company of a global family of companies that specialize in the design, manufacture, marketing and sale of tires for passenger cars, light trucks, medium trucks, motorcycles and for racecars. Cooper's headquarters are located in Findlay, Ohio, and it has manufacturing, sales, distribution, technical and design operations run by its family of companies located in more than a dozen countries around the world. For more information about Cooper, visit www.coopertire.com , www.facebook.com/coopertire or www.twitter.com/coopertire