FINDLAY, Ohio (May 3) — Cooper Tire & Rubber Co. plans to sell its shares of Kumho Tire Co. Inc. stock when the option becomes available next year.
Cooper spent about $107 million in February 2005 to acquire an approximate 11-percent share in South Korea´s Kumho as part of a strategy to explore areas of possible cooperation, the firm said at the time.
President and CEO Roy Armes told analysts Cooper intends to exercise its "put" option on the shares next February, when the option date is reached. That option would require Kumho to buy the shares at market value or at the price Cooper paid for them, whichever is higher.
Armes declined to say what Cooper would do with the cash.
Cooper´s purchase in 2005 was through the Korean firm´s initial public offering on the London Stock Exchange.
At the time, Cooper said it believed it was important to form strategic relationships with other strong players in the global tire industry to realize a good return for shareholders and continue its planned growth in products, technology and market share.
Two years into this thought process, though, the company has determined there´s not been enough progress in this direction to warrant continuing it and there are better options for using that capital, a spokesman said.