AKRON (Oct. 13, 2006) — Goodyear borrowed nearly $1 billion under an existing credit facility to improve its cash position during the United Steelworkers´ strike against 16 plants in the U.S. and Canada, the tire maker said.
Goodyear borrowed $300 million on Oct. 5—the day the strike began—and another $675 million on Oct. 13. Both were under Goodyear´s $1.5 billion U.S. First Lien Credit Facility, which is now almost fully drawn considering its $500 million deposit-funded facility, Goodyear added.
"Before the start of the United Steelworkers´ strike in North America, Goodyear had about $1.3 billion in cash and cash equivalents and approximately $1.6 billion in available credit lines," said Richard Kramer, executive vice president and CFO. "This action provides additional cash in the unlikely event of a prolonged strike."
Kramer added that Goodyear is shipping product to customers from existing inventory, operating non-affected tire plants as usual and operating affected plants with salaried employees in addition to importing supply from international operations.
About 15,000 union workers are participating in the strike.