Goodyear Sells Dunlop Back To Sumitomo Rubber For $701 Million

Goodyear Tire & Rubber Company has agreed to sell its Dunlop brand rights in Europe, North America, and Oceania to Sumitomo Rubber Industries (SRI) for approximately $701 million, marking a significant shift in the global tyre industry. The decision comes after Goodyear's ongoing plans to cut costs and trim its business portfolio.

Mark Stewart, Goodyear Chief Executive Officer and President said, "This is another important milestone as we continue to execute against our Goodyear Forward transformation plan. We are optimising our portfolio and reducing leverage to drive sustainable and substantial shareholder value creation. Not only does the transaction deliver significant value for our shareholders, it better positions Goodyear to enhance our focus on the growth of our core brands."

The deal includes $526 million for the Dunlop brand and associated intellectual property, a $105 million transition fee, and roughly $70 million for existing Dunlop tyre inventory. The transaction is expected to close by mid-2025, subject to regulatory approvals.

Under the agreement, Goodyear will continue manufacturing and selling Dunlop consumer tyres in Europe through at least December 2025, with a possible extension through 2026. Following this transition period, Goodyear will supply Dunlop-branded tyres to SRI in Europe for five years, with a minimum commitment of 4.5 million tyres annually.

The company will retain rights to the Dunlop trademark for its motorcycle tyre business in Europe and Oceania and maintain a licensed right to produce Dunlop commercial truck tyres in Europe.

The sale comes after Dunlop's consumer tyre sales reached $532 million in 2023, with commercial tyre sales at $201 million. Goodyear expects the transaction's impact on operating income to be minimal through the transition period, though it may reduce annual operating income by approximately $65 million during the supply agreement phase.