ApolloŅs shareholders," it said.
Cooper Tire terminates $2.5 bln sale agreement with India's Apollo
Mumbai/Bangalore: Cooper Tire & Rubber Co said on Monday it was terminating a proposed $2.5 billion sale to Apollo Tyres Ltd, saying the Indian tyre maker had failed to find financing for the transaction.
The termination, disclosed in a statement, marks the end of a failed agreement plagued by obstacles from the start. The Indian tyre maker in June agreed to buy Cooper for $35 a share, hoping to transform itself into the world's seventh-largest tyre maker and cut its dependence on domestic sales.
Cooper did not mention whether Apollo would pay a $112.5 million break-up fee, but said it believes the Indian tyre maker "has breached the merger agreement," and added it would continue to pursue "legal steps" to protect the company and its shareholders.
Apollo was not immediately reachable for comment.
The two companies have been mired in a bitter legal stand-off over the deal. Cooper has tried to force the Indian company to complete the deal under the agreed terms, while Apollo sought a price cut of as much as $9 a share, citing Cooper's U.S. labour trouble and disruptions at a Chinese joint venture.
"It is time to move our business forward," said Roy Armes, Cooper Tire's chief executive in the statement.
"While the strategic rationale for a business combination with Apollo is compelling, it is clear that the merger agreement both companies signed on June 12 will not be consummated by Apollo and we have been notified that financing for the transaction is no longer available," he added.
Expectations the deal would unravel rose after a court in Delaware in November ruled the Indian tyre maker had not breached its obligations, delivering a setback to Cooper's attempt to compel Apollo to close the deal.
An appeal by Cooper was dismissed by the Delaware Supreme Court this month. The case has returned to the lower court, which has asked for an update on Jan. 10 on the status of the deal.
The two sides have been in an acrimonious stand-off for months, with Cooper accusing Apollo of suffering a case of