Good Year to buy Cooper Tire for $2.8 billion

Goodyear Tire & Rubber Co said on Monday it would acquire Cooper Tire & Rubber Company for about $2.8 billion to double its presence in North America and China.

Goodyear said the deal also broadens the distribution for Cooper replacement tires through its retail store network.

Under the terms of the deal, Cooper shareholders will receive $41.75 per share in cash and a fixed exchange ratio of 0.907 shares of Goodyear common stock.

The implied cash and stock consideration for Cooper shareholders is $54.36 per share, representing a premium of 24% to its closing price on February 19.

After the deal closure, Goodyear shareholders will own about 84% of the combined company, which will be headquartered in Ohio, while Cooper shareholders will own about 16%.