PITTSBURGH (Nov. 16) — The United Steelworkers union is criticizing Goodyear´s announcement that it will offer about $1 billion of three-year and five-year senior unsecured notes, subject to market and other customary conditions.
The company said today it will use about one-half of the proceeds to repay $515 million in existing notes due Dec. 1 and March 1, while the rest of the money will be used for general purposes, including funding costs in the ongoing USW strike. The union called a strike Oct. 5 of about 15,000 workers Oct. 5 at 16 North American locations.
"Goodyear is already carrying about $6.4 billion dollars in debt, and its credit is poor and getting worse," said USW International President Leo W. Gerard. "Now they plan to borrow more money to flush down a rat hole of a fight they can never win."
Tom Conway, USW International vice president, who heads the union´s Goodyear bargaining team, said the move is the "wrong thing for the wrong reason at the wrong time."
"When you borrow money, you have to pay it back, and to pay it back Goodyear needs to build tires that people want to buy," Conway said. "This company has no such plan in place."