US: Goodyear plans public offering of common stock
Thursday, May 10, 2007, AutomotiveWorld.com
Goodyear Tire & Rubber has announced plans to offer 22.55 million shares of its common stock in an underwritten public offering to fund debt buybacks and to finance growth in its tyre business.
Goodyear expects to raise about US$725m, excluding underwriting discounts and commissions. Net proceeds of the offering are based on a US$33.26 / share closing stock price on 8 May 2007.
In addition, the company intends to grant the underwriters a 30-day option to purchase up to an additional 3.38 million shares to cover any over-allotments. The estimated net proceeds would be approximately US$834m if underwriters exercise their over-allotment option in full, Goodyear noted.
Goodyear plans to use the net proceeds from the offering to repay about US$175m of its 8.625% notes due in 2011 and about US$140m of its 9% notes due in 2015. The company would use the remaining amount for general corporate purposes, which may include investments in growth initiatives within the company's core tyre businesses and the repayment of other debt.
The company has appointed Deutsche Bank Securities, Citi and Goldman, Sachs & Co. as joint book running managers for the offering.
Published on Thursday, May 10, 2007
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