Bridgestone buys Bandag for over $1B
NASHVILLE, Tenn. — Bridgestone’s acquisition wheel has turned its attention to tire retread company Bandag as the two companies announced a $1.05 billion purchase agreement.
The Board of Directors of Bandag has unanimously approved the deal, which will transfer all outstanding shares of each class of stock to Japan-based Bridgestone for US$50.75 per share in cash.
complementary, both companies say
“Bandag is a leader in the retreading business, with a strong global reputation for quality, service and technology, as well as an extensive worldwide dealer network,” said Mark A. Emkes, chairman and CEO of Bridgestone Americas Holding, Inc. “The joining of Bridgestone Americas and Bandag will allow the two companies to better service their customers by offering a comprehensive tire maintenance solution, backed by a complete line of new and retread truck tire offerings.”
Bandag, which operates a global network of more than 900 franchised dealers that produce and market retread tires, also owns Tire Distribution Systems, Inc. (“TDS”), a commercial retail operation that sells and services new and retread tires, and holds an 87.5 percent interest in Speedco, Inc., a provider of on-highway truck lubrication and routine tire services to commercial truck owner-operators and fleets.
Bandag and Bridgestone have a decades-long business relationship through TDS stores, which have been authorized dealers of Bridgestone tires.
Retreads and new Bridgestone tires are complementary, says Bandag CEO Martin Carver, servicing different customer needs. Retreading enables customers to get the full value of a new tire by reusing the tire’s.
“As such, it is an integral part of a successful total tire management system,” he says.
The deal “will allow our dealers to go to market with an even more complete product offering,” Carver adds, “and provide customers with a total tire offering — a streamlined way to manage their needs throughout a tire’s life cycle.”
The transaction, which is subject to shareholder and regulatory approvals, is expected to close late in the first quarter or early in the second quarter of 2007.
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