Apollo Tyres has got yet another ruling in its favour in its ongoing legal tussle with Cooper Tire and Rubber Co over the completion of the $2.5-billion take over of the US-based tyre manufacturer.
In a press release, Apollo said the Delaware Supreme court on Monday dismissed Cooper Tire’s appeal against a lower court’s ruling that Apollo had not breached its obligations to the deal.
If the two companies are unable to resolve their difference by December 31, the deal is likely to fall through.
The latest court ruling comes three days prior to the scheduled hearing at the US court.
In October, Ohio-based Cooper had approached the Delaware court to enforce the buyout agreement, saying Apollo has failed to close the deal on the scheduled date of October 4.
However, Apollo did not want to close the deal before Cooper resolved issues with the United Steelworkers (USW) union, and a strike involving a Cooper joint venture with China’s Chengshan Group.
Cooper accused Apollo of using delaying tactics. It is delaying an agreement with the USW, which represents Cooper employees at its facilities in Findlay, Ohio and Texarkana, Arkansas.
An arbitrator ruled on September 13 that as a result of the pending merger, Cooper and Apollo must enter into new agreements with the union prior to closing.
But, Cooper went to Delaware Supreme Court, seeking a ruling to expedite the merger prior to December 31.
Until December 31, according to the November 8 partial ruling of the Court, both Cooper and Apollo were required to continue to perform their obligations under the merger agreement.
After the latest ruling the blame game between the two companies began. “Notwithstanding Cooper’s stated aim to continue to pursue its misguided legal claims, Apollo is committed to find a sensible way forward, if possible,” an Apollo spokesperson said.
Legal options “Cooper believes Apollo has breached the merger agreement and we will continue to pursue our legal options as we work to protect the interests of our company and our stockholders,” said Anne Roman, Vice President - Communications and Public Affairs, Cooper Tire.
The merger was announced on June 12 after the boards of directors of both companies unanimously approved the sale of Cooper to a wholly-owned subsidiary of Apollo for $35 per share.