Goodyear Completes Sale of North American Farm Tire Assets
AKRON, Ohio, Dec. 28, 2005 -- The Goodyear Tire & Rubber Company today announced it has completed the previously announced sale of its North American farm tire assets to Titan Tire Corporation, a subsidiary of Titan International, Inc.
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The sale includes Goodyear's farm tire manufacturing plant, property and equipment in Freeport, Ill., and inventories. It also includes a licensing agreement with Titan to pay a royalty to manufacture and sell Goodyear-branded farm tires in North America.
Goodyear received $100 million from Titan for the assets. It expects to record a loss of approximately $65 million on the sale, including charges for the curtailment of employee pension and post-retirement medical plans, of which approximately $60 million will be recorded during the fourth quarter of 2005 and the remainder will be recorded during 2006.
On an on-going basis, the sale will reduce revenue in Goodyear's North American Tire segment by about $200 million annually, but will eliminate the need for further investment in the farm tire business and position the company to enhance the segment's profitability.
"Goodyear tires have been a vital part of the American farm for nearly a century," said Jonathan D. Rich, president of the company's North American Tire business. "This transaction helps that relationship continue and allows us to increase our focus on our core consumer and commercial tire businesses."
Rich expressed his confidence that Titan Tire, for whom farm tires are a core business, will seek to maintain relationships with Goodyear farm tire dealers and the farming community.
"I thank our farm tire associates and dealers for their many years of service and support," he added.
Goodyear is the world's largest tire company. The company manufactures tires, engineered rubber products and chemicals in more than 90 facilities in 28 countries around the world. Goodyear employs about 75,000 people worldwide. For more information about Goodyear, visit www.goodyear.com/corporate.
Certain information contained in this press release may constitute forward-looking statements for purposes of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various factors, including but not limited to, the Company's ability to successfully implement its turnaround strategy for the North American Tire segment and to achieve its cost reduction goals. Additional factors that may cause actual results to differ materially from those indicated by such forward-looking statements are discussed in the company's Form 10-K for the year ended Dec. 31, 2004 and Form 10-Q for the quarter ended Sept. 30, 2005, which are on file with the Securities and Exchange Commission. In addition, any forward-looking statements represent our estimates only as of today and should not be relied upon as representing our estimates as of any subsequent date. While we may elect to update forward-looking statements at some point
in the future, we specifically disclaim any obligation to do so, even if our estimates change.
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