Cooper Tire & Rubber Co., a global tire design, manufacturing and marketing company, has entered into an agreement to purchase a majority of China-based Qingdao Ge Rui Da Rubber Co., Ltd.
Cooper will own 65 percent of the entity, which will be renamed Cooper Qingdao Tire Co., Ltd. (CQT), for about $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) tire production for Cooper, including Roadmaster brand tires for the North American market. Passenger car radial (PCR) tires 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 tires annually within the existing one million-square-foot production facility, with room for further expansion at the location.
“Cooper is excited to take this positive step to secure additional TBR tire supply and further our Asia growth strategy,” said Brad Hughes, Cooper’s chief operating officer. “After a comprehensive review of options, we are pleased to have reached this agreement, which meets our goal of finding a new source of high-quality, cost-competitive TBR tires for North America and Asia,” Hughes concluded.
Upon closing, CQT will join seven other tire manufacturing facilities in the Cooper family of companies with three U.S. plants in Findlay, Ohio, Texarkana, Ark., and Tupelo, Miss.; as well as facilities in Kunshan, China; Melksham, England; Krusevac, Serbia and a joint venture plant near Guadalajara, Mexico.