Cooper Tire & Rubber And Chengshan Group Reach CCT Option Deal - Quick Facts

(RTTNews) - Cooper Tire & Rubber Co. (CTB) announced Friday that it reached an option agreement with Chengshan Group Company Ltd. that affirms and provides additional details regarding the previously announced put and call process to resolve the future ownership of Cooper Chengshan (Shandong) Tire Company Ltd or CCT, as contemplated by the January 29, 2014 agreement among the two companies and the CCT labor union.

In addition, the new option agreement extends the option commencement deadline, which is the deadline for the independent valuation firm to deliver its fair market valuation of CCT, to August 24, 2014.

The company stated that the process for determining the future ownership of CCT begins with an independent valuation of the fair market value of CCT. Once the valuation is delivered, Chengshan has the first option, within 45 days, to elect to purchase Cooper's 65 percent interest, to sell its 35 percent interest to Cooper, or not to exercise either of these options.

If Chengshan determines not to exercise either of the options, Cooper has the right to purchase Chengshan's 35 percent interest. In the event that neither party elects to purchase the others' interest, the joint venture continues as currently structured.

In addition, if Chengshan purchases Cooper's stake in the joint venture, Cooper will continue to have offtake rights with CCT agreeing to produce Cooper-brand products, including Truck and Bus Radial (TBR) tires, for a minimum of three years.