Cooper to buy 65% equity in China-based Qingdao Ge Rui Da Rubber Co., Ltd
Cooper Tyre & Rubber Company announced that it entered into an agreement to purchase a majority of China-based Qingdao Ge Rui Da Rubber Co., Ltd (GRT). Cooper will own 65 % of the entity, which will be renamed Cooper Qingdao Tyre Co., Ltd. (CQT), for approximately $93 million including the acquisition and initial investments in the operation.
The transaction is expected to close during the first half of 2016 pending certain permits and approvals by the Chinese government.
CQT is expected to serve as a global source of truck and bus radial (TBR) tyre production for Cooper including Roadmaster brand tyres for the North American market as well as TBR tyre for Asia and other markets. Passenger car radial (PCR) tyres may also be manufactured at the facility in the future. It is estimated that at full capacity, CQT will be capable of producing approximately 2.5 million to 3 million TBR tyres annually and nearly the same number of PCR tyres within the existing one million-square-foot production facility, with room for further expansion at the location.
GRT is located north of Qingdao in northeast China and currently employs approximately 600 workers. It was established in 2014 after Qingdao Yiyuan Investment Co., Ltd. (QYI) purchased the assets of the then idle facility. QYI’s founder, Executive Director and General Manager is long-time tyre industry veteran Li Zhihua, who is also a professor at Qingdao University of Science and Technology. QYI has established production at GRT with an initial focus on TBR tyres and has put in place an experienced management team backed by a skilled workforce with extensive tyre industry expertise.