Goodyear completes engineered products unit sale
(Adds details on deal completion from Goodyear and Carlyle)
CHICAGO, Aug 1 (Reuters) - Goodyear Tire & Rubber Co (GT.N) said on Wednesday it completed the nearly $1.48 billion sale of its engineered products unit to private equity firm Carlyle Group [CYL.UL], which has renamed it Veyance Technologies Inc.
Goodyear, the largest U.S. tire maker, expects net proceeds of $1.4 billion and expects to record an after-tax gain in the third quarter from the sale.
Goodyear said in late July that its multiyear restructuring plan is on track and the sale of the engineered products unit will complete the major planned asset sales in the program.
The tire maker plans to use the sale proceeds to reduce debt, fund the health-care trust for union retirees that was the centerpiece of its contract settlement with the United Steelworkers late last year and to expand its tire business.
Carlyle and Goodyear announced the deal in March, but the private equity firm had to reach a new contract with the United Steelworkers to complete the purchase. The union announced the contract on Monday.
The products produced will continue to carry the Goodyear brand under a long term license agreement. Veyance is based in Akron, Ohio, as the unit was previously. Carlyle also plans to pursue other growth opportunities, it said.
The business has 32 facilities in 12 countries and about 6,300 employees, producing engineered rubber products for the industrial, military, consumer and transportation markets.
(Reporting by David Bailey)
((Editing by Andre Grenon; Reuters Messaging: david.bailey.reuters.com@reuters.net; e-mail: david.bailey@reuters.com +1 312-408-8135)) Keywords: GOODYEAR/
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