MUSCATINE, Iowa (Dec. 6, 2006) — Several months ago Bridgestone Americas Holding (BAH) Co. Chairman and CEO Mark Emkes approached Bandag Inc. Chairman and CEO Martin Carver unsolicited to talk about combining their companies, Mr. Carver told Tire Business in an exclusive interview.
Mr. Carver, 58, said he first told Mr. Emkes that Bandag would stay independent, but he did bring the proposition before Bandag's board of directors. The inquiry from BAH turned out to be serious, Mr. Carver said, and the process to sell Bandag began around the time the company announced in June that it would undertake a 15-percent workforce reduction by year's end.
“We weren't looking for this. There wasn't any catalyst to doing this from our side,” Mr. Carver said of the pending acquisition.
In the end, BAH made a “deal we couldn't refuse,” he said. Without elaborating further, he did say a detailed timeline of the deal will be published in the company's final proxy statement due in January.
Mr. Carver also emphasized that competition in the North American retread market—by Goodyear and Michelin North America Inc. in particular—was formidable, but was not a factor in the pending $1.05 billion sale of Bandag to BAH announced Dec. 5.
“I thought we did pretty well,” he said. “(Michelin mascot) Bib is a pretty tough match in the wrestling ring, but now Bib's gonna have a Sumo wrestler to deal with. We'll see how that goes.”
He declined to comment on Bandag's market share or that of its competitors.
Once the deal closes late in the first quarter or early second quarter, Mr. Carver will have an advisory role with Bandag. He said he has been so focused on getting the deal through that he hasn't thought about or planned his future activities once his company becomes a BAH subsidiary. That said, Mr. Carver said he isn't going to retire and may consider running another business, though not in the rubber industry.
“Business might be one of the things I might do,” he said. “I could get involved in other pursuits. I have a very broad array of interests, so I could be doing something academic, I could be doing something creative, or I could be doing all of the above.”
BAH has committed to keeping Bandag headquarters in Muscatine, and Mr. Emkes visited with employees there Dec. 5 after the merger's announcement, Mr. Carver said.
“He did a tremendous job in reassuring our people that Bridgestone likes this business very much, that the price they paid for it was an indication of that admiration and that they're fully planning on running this as a separate entity reporting to Mr. Emkes directly,” Mr. Carver said.
It hasn't been determined yet, he said, whether a Bandag executive will be named as the chief executive of the firm once BAH takes over its operation, but Nashville, Tenn.-based Bridgestone Americas did make a commitment to keeping wages and benefits unchanged for a year.
“The commitments that these guys have made have gone way beyond anything that we could have expected in a situation like this,” Mr. Carver noted.
To read the complete version of Ms. Linsalata's interview with Mr. Carver, pick up the Dec. 18 print edition of Tire Business.