Cooper Tire & Rubber Co. (CTB:US) said it reached a deal with the United Steelworkers union on the eve of a trial seeking to force a $2.5 billion takeover of the company by Apollo Tyres Ltd. (APTY)
Cooper demanded that Apollo, which is obligated by the terms of its buyout agreement to help resolve union disputes, sign off on the agreement with the union by today, according to papers filed this morning in Delaware Chancery Court. Apollo called the move a “last-minute stunt.”
“Apollo objects to this last-minute hijack of this expedited litigation,” Christopher Lyons, an attorney for the company, said in a pretrial filing made jointly by the two companies. Cooper is attempting to insert an entirely new set of issues into the case before the Nov. 5 trial, Lyons argued.
Cooper, based in Findlay, Ohio, said on June 12 it would be bought by Apollo. Cooper sued Apollo to enforce the buyout after the Gurgaon, India-based company failed to close the deal by an Oct. 4 deadline, citing labor union disputes in the U.S. and a strike at a Chinese partner’s tire operations.
Apollo has said it won’t complete the transaction unless Cooper agreed to a price reduction.
Cooper fell 40 cents, or 1.5 percent, to $25.61 at 10:52 a.m. in New York.
“Apollo is currently using its best efforts to delay the transaction, is adding conditions to closing not found in the merger agreement, and is deliberately preventing the merger from closing,” John Sensing, an attorney for Cooper, said in the filing.
Apollo should be compelled to consent to the new agreement reached with the United Steelworkers on Oct. 30 and then be required to consummate the merger, Cooper said in court papers.
Delaware Chancery Court Judge Sam Glasscock III in Wilmington has set three days for the trial.
The case is Cooper Tire & Rubber Co. (CBT:US) v. Apollo Holdings Pvt Ltd., CA8980, Delaware Chancery Court (Wilmington).
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