Chengshan Group Plans To Exercise Its Option To Buy Cooper's 65% Stake In CCT

(RTTNews) - Cooper Tire & Rubber Co. (CTB) confirmed that it has received notice and related documentation from Chengshan Group Company Ltd. that it intends to exercise its option to acquire Cooper's 65 percent ownership stake in Cooper Chengshan (Shandong) Tire Company Ltd or CCT.

Cooper said it is currently reviewing the notice and documentation provided by Chengshan to confirm that all of the requirements under the August 14, 2014 option agreement have been met.

Cooper noted that it is committed to meeting the needs of its customers and continuing to grow in China. Should the process of resolving the ownership of CCT result in Chengshan acquiring Cooper's interest in the joint venture, a commercial offtake agreement is in place under which CCT is required to produce Cooper brand products—including Roadmaster truck tires—through mid-2018.

"The purpose of the offtake agreement is to assure a secure supply of Cooper brand products while also giving us the flexibility to enter into acquisitions, new offtake relationships, or possible greenfield development of additional production capacity anywhere around the world to support the continued expansion of our business," said Cooper Chairman, Chief Executive Officer and President Roy Armes.

"China is a core growth market for Cooper and we have a strong track record of success in the region. To support our strategic plans there, we expect to continue to invest in our sales and marketing organization, our rapidly growing distribution network, and the strong technology capability we have in place," Armes continued.

In addition, the Cooper noted that it expect to continue to invest in its wholly-owned Cooper Kunshan Tire operation.