AKRON–Additional details are emerging on nearly $1.5 billion in new debt Goodyear is taking on to help buy Cooper Tire & Rubber Co.
Goodyear, based in Akron, said May 14 it will pay 5 percent annual interest on $850 million in senior notes due in 2029 and 5.25 percent annual interest on another $600 million of senior notes due in 2031.
The debt offering is expected to close on May 18.
Goodyear is using this $1.45 billion private offering, along with cash on hand as well as money available through its existing revolving credit to cover the cash portion of its $2.5 billion acquisition of Cooper. The debt is unsecured.
Goodyear in February revealed plans to acquire Findlay, Ohio-based Cooper for $41.75 in cash and 0.907 shares of Goodyear common stock for each Cooper share. After the deal closes, current Cooper shareholders will own about 16 percent of the combined company.
Cooper is the fifth-largest tire maker in North America by revenue.
Goodyear, in early April, also priced a public offering of $550 million in senior notes due in 2031 with an interest rate of 5.25 percent as well as $450 million in senior notes due in 2033 with an interest rate of 5.65 percent. This money was to redeem $1 billion in senior debt due in 2023.
