AKRON (Sept. 26, 2005) — Titan International Inc. has formed a partnership with Rodos Giants L.L.C. and is in discussions to try to purchase Continental Tire North America Inc.'s Bryan, Ohio, off-the-road (OTR) tire plant.
Titan, the Quincy, Ill.-based wheel and tire maker, became a prospective buyer in mid-August, a Conti spokeswoman confirmed. Titan Chairman and CEO Maurice “Morry” Taylor declined to discuss the talks or the specifics on his partnership with Rodos but acknowledged that the Bryan facility interests him because “we make all the wheels those tires go on,” and OTR is where Titan wants to go.
Buying the Bryan plant would appear to make sense for Titan. Conti's OTR facility manufactures bias- and radial-ply ag, earthmover, industrial and OTR tires at a capacity of 232 units per day. Earthmover and industrial tire sales comprise 31 percent of Titan's tire sales, and its Des Moines, Iowa, plant does not manufacture OTR tires.
Conti also acknowledged for the first time that it is reviewing other potential buyers, a retreat from earlier assertions that it was committed to completing the sale of the facility to Dortmund, Germany-based RÃ¶sler Group, parent of Rodos. The Charlotte, N.C.-based tire maker also said it had not extended its letter of intent with RÃ¶sler, which expired Aug. 31.
Conti and RÃ¶sler had signed a letter of intent on Jan. 13, and the deal was scheduled to close July 31. But Rodos and the United Steelworkers (USW) union could not reach a collective bargaining agreement as required by a successorship clause in Conti's union contract.
However, Titan has its own reputation for stalemates with union workers, including a 40-month strike at its Des Moines facility. When asked if past relations between Mr. Taylor and the union could be an obstacle to the Bryan sale, a Conti spokeswoman noted that “Mr. Taylor has been successful in obtaining agreements with the USW in the past, and we are sure that he will work diligently to obtain an agreement in this case as well.”
USW Executive Vice President Ron Hoover is handling negotiations between the union and Titan/Rodos, according to John Bowling, Bryan Local 890L unit chair.
“We're in a wait-and-see type of thing to see who they're going to sell it to,” Mr. Bowling said. “Since Morry's in the mix, it changes everything. That's my understanding of it.”
Meanwhile, Titan still is in the process of acquiring Goodyear's farm tire unit for $100 million, including negotiating a contract with the USW for the Freeport, Ill., farm tire plant. A Goodyear spokesman said the Akron tire maker had extended its deadline to close on the sale of the unit to Oct. 1.
Mr. Taylor told Tire Business that Titan is continuing its negotiations with the union, and Freeport Local 745 members are meeting to review the company's latest proposals. He called Titan's offer to Freeport workers “very, very attractive” and said it would cover the next five years.