Sept 16 A U.S arbitrator said Cooper Tire and
Rubber Co cannot sell two of its factories in the
country to India's Apollo Tyres until a collective
bargaining agreement is reached between Apollo and members of
the plants' union.
The decision could delay Apollo's plan to buy U.S.-based
Cooper in a debt-funded $2.5 billion deal, which is already
facing opposition at a factory in China.
The United Steelworkers (USW) had said terms of the
agreement, which covers about 2,500 USW members, will be
violated if Cooper closes the deal without Apollo entering into
a new agreement with the workers at Findlay, Ohio, and
"The USW said it looked forward to resuming bargaining with
Apollo and Cooper," USW Secretary Treasurer Stan Johnson said in
a statement on Friday after the arbitrator's decision.
Cooper had previously argued that the current collective
bargaining agreements would continue after the merger. It did
not respond to an email seeking comment outside U.S. business
hours on Monday.
"Apollo looks forward to working with Cooper and the USW to
resolve this matter," it said in an email.
Apollo had agreed in June to buy Cooper Tire to take
advantage of the large U.S. and China auto markets, but labor
unions in both countries and investors are worried about the
risks arising from the large amount of debt.
The labor union at Cooper Chengshan Tire Co in China's
eastern Shandong province has been striking against the deal for
about three months. Chengshan Group, the local partner in the
joint venture, is also against the deal, and has filed a lawsuit
against Cooper in a local court, seeking to dissolve the JV.
(Reporting by Aradhana Aravindan in MUMBAI and Samuel Shen in
SHANGHAI; Editing by Jeremy Laurence)