According to insiders, Bridgestone Corporation in Japan is in deep negotiations to acquire at least $1 billion of the off-the-road (OTR) tire business of Goodyear Tire & Rubber (GT. US).
According to informed sources, Bridgestone Corporation in Japan is in deep negotiations to acquire at least $1 billion of the off-the-road (OTR) tire business of Goodyear Tire & Rubber (GT. US). The source said that after other bidders dropped out, the Japanese company became the most likely buyer of Goodyear's OTR business. The valuation of these assets for this transaction may be between $1 billion and $1.5 billion.
Insiders said that Bridgestone Corporation is discussing financing with banks. Insiders said that negotiations are still ongoing and an agreement may not be reached.
Affected by this news, Bridgestone Corporation's stock price fell by 7.1% at one point on Wednesday, the largest intraday decline since November 2022.
Against the backdrop of slow economic growth in Japan, a range of Japanese companies from industries such as industry, medical care and technology are seeking overseas assets to achieve business diversification and expansion.
Bridgestone Corporation's website shows that its products include passenger vehicle, truck, and bus tires, as well as tires for industrial vehicles, mining, and construction equipment. OTR tires are used in industries such as mining.
Goodyear, headquartered in Akron, Ohio, said in November last year that it was looking for alternative options for its chemical business, Dunlop brand, and OTR division, with the goal of raising at least $2 billion.
Goodyear warned that as competitors increase their capacity in low-cost countries and actively compete for market share, competition in the tire manufacturing industry will become more intense. Goodyear's main global competitors include Bridgestone Corporation and Michelin.
As of press time, Goodyear's stock rose 1.13% in pre-market trading to $10.72. The stock has fallen 26% this year, with a market cap of $3 billion.