PHILADELPHIA (Aug. 23, 2016) — The U.S. Court of Appeals for the Third Circuit has affirmed a Delaware federal court's dismissal of a class-action lawsuit against Cooper Tire & Rubber Co. over Cooper's failed merger with Apollo Tyres Ltd.
The appeals court ruled straight down the line for Cooper Aug. 22, concluding that the Delaware court was correct in its decision that OFI Asset Management and Timber Hill L.L.C. failed to demonstrate sufficient facts to support their claims that Cooper committed violations of federal securities laws.
Cooper and Apollo agreed in June 2013 to a $35-per-share merger, totaling $2.5 billion. Nine days later, workers at Cooper Chengshan Tire Co. Ltd. — Cooper's Chinese tire-making joint venture with Chengshan Group — went on strike in protest over the merger, with the encouragement of Chengshan management.
Because of the strike, Apollo requested a reduction of between $2.50 and $9 per share in the purchase price. Cooper filed a lawsuit against Apollo in October 2013 in the Delaware Supreme Court, and by the end of the year the merger was dead.