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Goodyear Announces Closing of Mandatory Convertible Preferred Stock Offering


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AKRON, Ohio, March 31, 2011 -- The Goodyear Tire & Rubber Company today announced the closing of its public offering of mandatory convertible preferred stock.  

In connection with the closing, the underwriters exercised in full their option to purchase an additional 1.3 million shares of the mandatory convertible preferred stock.  With the exercise of the underwriters' option, 10 million shares of the mandatory convertible preferred stock were issued in the closing at a price of $50 per share.

Including the exercise of the underwriters' option, the net proceeds from the offering, after deducting underwriting discounts and commissions and offering expenses, totaled approximately $484 million.

Goodyear intends to use the net proceeds from the offering to redeem $350 million in principal amount of its outstanding 10.500% senior notes due May 15, 2016 at the redemption price of 110.500% of the principal amount plus accrued and unpaid interest to the redemption date. This redemption is pursuant to provisions of the notes that allow the company, at its option, to redeem up to 35 percent of the original principal amount with proceeds from one or more equity offerings.  The company intends to use the remaining net proceeds from this offering for general corporate purposes, which may include the repayment of other outstanding indebtedness.  

Goldman, Sachs & Co., J.P. Morgan Securities LLC, Citi and Credit Agricole Securities (USA) Inc. served as joint book-running managers for the offering.

Goodyear is one of the world's largest tire companies.  It employs approximately 72,000 people and manufactures its products in 56 facilities in 22 countries around the world.