Updated at 7:58 am EST
Goodyear tires and rubberG.T.The shares rose in early trading on Wednesday after it revealed plans to offload some of its key business units, as well as the departure of chief executive Richard Kramer, in a major shake-up of the iconic industrial group.
Goodyear said it would consider “strategic alternatives” for its Dunlop tire brand, as well as its off-road and chemical equipment tire units, which together could bring the group around $2 billion if eventually sold, as it pursues a plan. of cost reduction, he says. will save around $1 billion by the end of 2025.
Goodyear began a strategic review in July following pressure from activist investor Elliott Investment Management, which became one of the group’s largest shareholders in May. Elliott, who won three seats on Goodyear’s board, accused the group of falling behind rivals such as Michelin and Bridgestone amid weak overall management.
“Our transformation plan represents a clear path to creating a more profitable and focused Goodyear,” said Kramer, who will retire at the end of the year after 14 years as group CEO. “The Review Committee explored all value maximization opportunities and identified specific and detailed initiatives to optimize our portfolio, expand margins and strengthen our balance sheet, and do so quickly.”
“Leveraging our strengths, this plan will enable Goodyear to enhance and expand our leadership position, deliver profitable growth in all markets, create significant value for our shareholders, and ultimately lay the foundation for success over the next 125 years.” years,” he added.
Goodyear shares rose 6.22% in premarket trading to indicate an opening price of $14.51 each, a move that would extend the stock’s 2023 gain to around 45% and value the Akron, Ohio-based group at around $4.1 billion.
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