Goodyear Tire & Rubber Co. announced on Monday it will sell its off-the-road equipment tire business to Japan’s Yokohama Rubber Co. for $905 million in cash. This divestiture is part of Goodyear’s strategic efforts to streamline its operations and cut costs.
Last year, Goodyear unveiled plans to slim down its business portfolio, targeting more than $2 billion in gross proceeds. This included reviewing its chemical unit, Dunlop brand, and the Off-the-Road unit. The company aims to focus on its core operations while improving profitability.
In January, Goodyear appointed a former Stellantis executive as its new CEO, following pressure from activist shareholder Elliott Investment Management to enhance company leadership and performance.
Goodyear’s off-the-road business, which produces tires for industries such as mining and construction, will transition to Yokohama Rubber by early 2025, pending regulatory approval. The agreement includes an initial period of up to five years where Goodyear will manufacture certain off-the-road tires for Yokohama Rubber at its facilities.
Yokohama Rubber stated that this acquisition will enhance its product portfolio and strengthen its presence in non-agricultural segments. The deal includes the acquisition of Nippon Giant Tire in Japan’s Hyogo prefecture, Goodyear Earthmover in Australia, and other global assets.
Goodyear was advised by Evercore on the transaction. This strategic move is expected to allow both companies to better focus on their respective market segments and growth opportunities.
