According to a witness, buy cialis Apollo Tyres Ltd. sought to eliminate an obstacle to its $2.5 billion buyout of Cooper Tire & Rubber Inc. by offering to purchase Cooper’s Chinese unit for $147 million.
Apollo officials made the offer in hopes of overcoming the opposition of executives of Cooper’s Chinese joint venture to the $35-a-share acquisition of Cooper, order Sunam Sarkar, stomach Apollo’s chief financial officer, told Delaware Chancery Court Judge Sam Glasscock III yesterday at a trial over the faltering deal. The Chinese officials rejected the offer, seeking at least $200 million, he said.
Sarkar’s testimony about the effort to buy the Chinese unit, code-named “Project Charlie,” was intended to counter Cooper’s claims that Apollo suffered from buyer’s remorse after agreeing to buy the U.S.’s fourth-largest tire maker and now is seeking to torpedo the deal. Apollo made the offer to push the deal forward, Sarkar said.
Glasscock is being asked to decide whether labor troubles with the Chinese joint venture unexpectedly damaged the value of Findlay, Ohio-based Cooper’s business and provided a basis for Apollo to pull out of the acquisition or cut the price. The Gurgaon, India-based tiremaker demanded a $2.50-a-share price cut to complete the deal.
Cooper officials testified earlier in the case that they alerted Apollo executives that their Chinese partners might object to the buyout. Chinese officials have stopped making Cooper-brand tires at its facility and ceased uploading financial information to the parent company’s computers.
That means Cooper may have difficulty in producing third-quarter financial results and Apollo officials might point to that as a breach of the acquisition agreement.
The lack of financial information about the Chinese operation “raises accounting questions” over the buyout and leaves Apollo executives with no assurances about the “quality of the financial information they are getting” from Cooper, Cepielik, an accountant with Deloitte Financial Advisory Services LLP, testified. He was called as an expert by Apollo.