Created on Monday, 30 December 2013 Written by THE ASSOCIATED PRESS
FINDLAY, Ohio (AP) — Cooper Tire & Rubber Co. is calling off its proposed $2.2 billion sale to India's Apollo Tyres, a deal that would have created the world's seventh largest tire company.
The Findlay, Ohio, company said Monday that financing is no longer available and continues to claim, as it has for months, that Apollo breached the terms of the agreement.
The boards of both companies and Cooper shareholders had approved the buyout, but negotiations with the union representing Cooper employees became a sticking point.
After Apollo sought a better price citing labor issues in China and weaker profit, Cooper accused the company of stalling.
Cooper took its claim to a Delaware court, but the court ruled last month that Apollo did not breach its obligation to quickly reach a pact with the United Steelworkers union.
Cooper did not further elaborate Monday on how it believes on how Apollo ignored terms of the deal and did not immediately respond to a request seeking comment.
The company did say that it's become clear that the deal signed in June will not close.
"The right thing for Cooper now is to focus on continuing to build our business," Chairman and CEO Roy Armes said in a statement Monday.
Shares of Cooper fell 4 percent, or 96 cents, to $22 before markets opened, close to the trading low for 2013.
Company shares soared to nearly $35 in June after it announced the buyout, but they have fallen steadily since then. Monday's pre-market drop put the stock down about 15 percent so far this year.