COOPER Tire & Rubber Company lodged an appeal to the Delaware Chancery Court, seeking to require Apollo to expedite closing of the pending merger agreement between it and the latter firm, as per the terms of the definitive merger agreement.
End of September, Cooper stockholders voted overwhelmingly to approve the pending merger, satisfying Cooper’s final affirmative condition under the merger agreement for closing the US$2.5 billion, all-cash transaction.
The pending merger was announced on June 12 after the boards of directors of both companies unanimously approved the sale of Cooper to a wholly-owned subsidiary of Apollo for US$35 per share. Cooper has asked the court to compel Apollo to take actions so that the transaction may close. Among other matters, the complaint says that Apollo is seeking to delay an agreement with the United Steelworkers (USW), which represents Cooper employees at facilities in Findlay, Ohio, and Texarkana, Arkansas.
An arbitrator ruled on September 13 that, as result of the pending merger, Cooper and Apollo must enter into new agreements with the union prior to closing. By delaying resolution with the USW, Apollo is breaching the merger agreement.
Cooper on its part says that it upholds its obligation to protect the rights of its stockholders, who voted overwhelmingly in favour of the merger.