Cooper Tire & Rubber Company has signed a definitive agreement to sell its automotive business, Cooper-Standard Automotive, to an entity formed by The Cypress Group and Goldman Sachs Capital Partners for approximately $1.165 billion in cash, subject to certain post-closing adjustments. The transaction, which is expected to close in the fourth quarter of 2004, still is subject to the purchaser's receipt of financing from committed sources and other customary conditions, including the receipt of regulatory approvals.
Cooper Tire & Rubber Company, headquartered in Findlay, Ohio, specializes in the manufacture and marketing of products for the global automotive industry. Products include automotive, motorcycle and truck tires, inner tubes, tread rubber and equipment, as well as sealing, trim, NVH control systems and fluid handling systems. The3 company has more than 20,000 employees and 52 manufacturing facilities in 13 countries.
Cooper-Standard Automotive is a manufacturer of fluid handling systems, body sealing systems, and active and passive vibration control systems, primarily for automotive original equipment manufacturers. The group is headquartered in Novi, Mich., and had revenue of approximately $1.6 billion in 2003.
Proceeds from the sale will be used for debt reduction, investment in Cooper's tire operations, to repurchase shares or a combination thereof, said Thomas A. Dattilo, Chairman, President, and Chief Executive Officer of Cooper Tire & Rubber Company.
The Cypress Group is a New York based private equity group which manages two private equity funds with more than $3.5 billion in commitments. Cypress invests in privately negotiated transactions, targeting operating businesses and investing with management to foster continued growth. Investments made by Cypress include Cinemark, Inc.; AMTROL, Inc.; Williams Scotsman, Inc.; WESCO International, Inc.; ClubCorp, Inc.; Danka Business Systems PLC; MedPointe Inc.; Montpelier Re Holdings, Ltd.; Republic National Cabinet Corp.; Catlin Group Ltd.; The Meow Mix Company; Financial Guaranty Insurance Company (FGIC); and Communications & Power Industries, Inc.
To date, Goldman Sachs has formed ten investment vehicles aggregating over $17 billion of capital. With $5.25 billion in committed capital, GS Capital Partners 2000 is the current primary investment vehicle for Goldman Sachs to make privately negotiated equity investments. Investing across a broad range of industries, GS Capital Partners 2000 says it seeks long-term capital appreciation by committing equity to high-quality companies with superior management in a variety of situations, including leveraged buyouts, recapitalizations, and growth investments to fund acquisition or expansion.
Lazard Freres & Co. LLC served as financial advisor to Cooper Tire & Rubber for this transaction.
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