COOPER Tire & Rubber’s US$2.3 billion acquisition efforts for Indian firm Apollo Tyres has yet stumbled upon another legal setback, paving the way for Apollo to walk away from the deal.
In a recent development, the Delaware Supreme Court had dismissed Cooper’s appeal against an earlier lower court ruling that Apollo was meeting its obligations to reach new contract terms with unions at Cooper plants in Ohio and Texas.
With the latest court ruling, which came three days before it was due to be delivered, Cooper is left with little chance to keep Apollo from dropping the long-pending and contentious deal.
Apollo wants to pay less than the US$35 per share agreed in June because of demands by unions at Cooper plants and disruptions at Cooper’s venture in China.
Cooper wanted the Delaware Supreme Court to overturn a ruling by a judge on the lower Court of Chancery who found that Apollo had not breached its obligations under the terms of the deal. The Indian company commented: “Cooper’s litigation strategy to date has done nothing but generate unnecessary cost for its shareholders and for Apollo, and compound the obstacles that Cooper’s situation has created for this merger.”