Yokohama Rubber Co., Ltd. has announced an agreement to purchase the Off-the-Road (OTR) tire business from The Goodyear Tire & Rubber Company. This acquisition, valued at $905 million (approximately ¥129.4 billion).
The deal is pending regulatory approvals.
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Strategic Fit with Yokohama Transformation 2026
The acquisition aligns with Yokohama Rubber’s medium-term management plan, Yokohama Transformation 2026 (YX2026). This plan seeks to leverage existing business strengths while exploring new value opportunities. The strategic purchase is set to drive “Hockey Stick Growth,” a key objective of YX2026, by expanding Yokohama Rubber’s OHT business through programmatic mergers and acquisitions.
Global Market Expansion and Product Enhancement
The global OHT market, valued at around ¥4 trillion, is projected to grow at 6% annually, outpacing the 2% growth expected in the consumer tire market. Yokohama Rubber is already a significant player in the agricultural and forestry machinery tire segment, which constitutes about 40% of the OHT market. Acquiring Goodyear’s OTR business will enhance Yokohama Rubber’s product range in non-agricultural applications, complementing its existing offerings.
Strengths of Goodyear’s OTR Business
Goodyear’s OTR business has demonstrated stable performance, with fiscal 2023 sales of approximately $678 million (about ¥95.4 billion) and an EBITDA of $129 million (about ¥18.1 billion), reflecting an EBITDA margin of 19%. The brand is renowned for its advanced tire-making technologies and high-quality services, delivered by skilled professionals. The product lineup includes a wide range of tire sizes, from small to ultra-large diameters, enhancing Yokohama Rubber’s capability to meet diverse customer needs.
Acquisition Details and Future Synergies
Yokohama Rubber will acquire all shares of Nippon Giant Tire Co., Ltd., which operates an OTR plant in Hyogo Prefecture, Japan, and Goodyear Earthmover Pty Limited in Australia, along with certain OTR assets globally. This acquisition will not only diversify Yokohama Rubber’s product portfolio but also provide the company with the production and development capabilities for large and ultra-large tires, an area where it currently has limited offerings.
The integration of Goodyear’s OTR business is expected to generate significant synergies, enhancing Yokohama Rubber’s product development, manufacturing, sales, and quality control processes. This strategic move will enable Yokohama Rubber to better serve its customers’ needs and drive growth in its OHT business.
Related:
Yokohama in Advanced Talks to Acquire Goodyear’s OTR Tyre Business
