QUINCY, Ill. (April 1, 2011) — Titan Tire Corp. has completed its acquisition of Goodyear's Latin American farm tire business for approximately $98.6 million, subject to post-closing conditions and adjustments.
The transaction includes Goodyear's Sao Paulo, Brazil, tire plant, property, equipment and inventories and a licensing agreement that will allow Titan to sell Goodyear-brand farm tires in Latin America and North America.
Titan's proposed purchase of Goodyear's farm tire assets in Europe is still pending as Goodyear works through the closing requirements, Titan said.
“Over the next 18 to 24 months, we believe Latin America revenue can grow up to approximately $400 million by adding OTR radials and other earthmover and construction tires to the facility,” said Maurice M. Taylor, chairman and CEO of Titan Industries Inc., parent of Titan Tire.
“This expansion into Latin America supports our global vision of becoming the world's premier farm tire manufacturer.”
Revenue generated by the Sao Paulo plant is running at approximately $250 million annually, Titan said, split roughly 50:50 between farm product sales and non-agriculture products that Titan will build for Goodyear under supply agreements.
The 72-year-old Sao Paulo factory produces light and medium truck tires in addition to farm and OTR tires. Capacity is listed as 4,500 units a day with 600 employees.
Goodyear agreed to sell its European and Latin American farm tire businesses to Titan last December after having them for sale since May 2009. Titan bought Goodyear's North American farm tire business, including a plant in Freeport, Ill., in 2005.
The European portion of the transaction include the plant, property, equipment and inventories of Goodyear's Amiens North factory in France. The deal depends on Goodyear's being able to complete a social plan at the plant related to the previously announced discontinuation of consumer tire production at that site.