Goodyear Announces $1B Private Debt Offering · 11/16/2006
The Goodyear Tire & Rubber Company said it is offering $1 billion of senior unsecured notes, split 50-50 between three-year notes sold at 99% of principal and earning interest at LIBOR + 375 basis points and five-year notes sold at par and earning interest at 8.625%. Goodyear said it would use the cash to roll over old debt due in December 2006 and March 2007, as well as “for general corporate purposes, which may include addressing the continuing strike by the United Steelworkers.”
Goodyear also announced that its sales for the third quarter of 2006 totaled $5.3 billion, up 6 percent compared to 2005 “excluding the impact of businesses divested in 2005.” Operating income hit $313 million, down 5 percent vs. last year.
Goodyear earlier said that it would close its plant in Tyler, Texas, “as part of its previously announced strategy to exit certain segments of the private label tire business.” At the same time, the company redesigned its Tire stores to “focus on [the] in-store needs of consumers,” according to Goodyear exec Rob Rajkowski. “The new design was developed based on the feedback of consumers who said they preferred a more informational store environment when purchasing tires.”
— Rim & Tire Wholesalers
