The Cooper Retirees Organization, a nonprofit group, "will keep retirees informed and educated regarding the safety of their pension", said Dick Stephens, former president of North American Tire Operations, who retired in 2006. He is president of the group.
"We believe that Cooper pensions are at risk should the merged companies fail in future years," Stephens said.
The group is a member of the National Retirees Legislative Network of Washington, D.C., a retirees pension organization,
which is assisting Cooper Retirees Organization.
Cooper Retirees Organization
CRO Board Update January 6, 2013
As you all probably know by now the deal to sell Cooper Tire & Rubber Company to Apollo Tyre of India has been terminated. We think this is good news for retirees, as Cooper will not be burdened with a large debt load.
Roy Armes announced Cooper would now return their focus on running the business. There are several major challenges as Cooper moves forward. First, upper management must win the trust of the employees and customers. Second, they must reconcile their differences with their Chinese partner, Chengshan. Third, they must improve operations, increase sales, prepare for the increasing competitiveness from the new tire plants planned in the US, and fix the problems with the ERP system (enterprise resource planning system).
The past six months has damaged Cooper's business. While management indicates a profitable last six months, we suspect poor comparative results for the third and fourth quarters of 2013. We know Cooper has not been able to get radial medium truck tires since mid-year. We know the US tire plants have had numerous shutdown days. The Chengshan plant probably has not been running at full production as they have refused to produce Cooper brand products. All of these situations create adverse financial impacts. We will not know the impact until Cooper is able to report their financial results, which are being delayed because they cannot obtain operating results from their Chinese partner.
Cooper will continue to use the courts to pursue damages. The Delaware Chancery Court is being petitioned to address several unresolved issues pertaining to the merger agreement. The outcome of these hearings is not certain. The only certainty is big legal fees paid to attorneys for both sides.
We are not sure what is going to happen in regards to shareholder lawsuits, potential proxy fights, or the future of Cooper's upper management. There may be some insights into these issues in the coming weeks and months. If they develop, we will post pertinent information on our website (cooperretirees.org). We encourage you and other Cooper retirees to visit the website to keep abreast of current events. We will continue to update the website with news articles and other pertinent information as they develop. We also encourage you to invite all Cooper retirees to join Cooper Retirees Organization and support our efforts.
There is potential Cooper Tire & Rubber Company is still for sale. Current management and the Board will do their best to strengthen the balance sheet (financials) and the operations over time; thus, setting up the company for sale again sometime in the future. It will take time to get operations to acceptable levels and resolve current and potential legal issues.
CRO will continue to monitor the financial situation and do what we can to push for the full funding of our pensions. We will continue to inform the PBGC (Pension Benefit Guaranty Corporation) and urge them to work with Cooper to keep the pension plan adequately funded. We have engaged a law firm specializing in pension law to advise us on the best ways to achieve our goal of a fully funded pension plan. The past year has seen significant increases in the stock market and we believe the pension plan funding is in a better position than last year, which is good news for all retirees. We hope these improvements will make Cooper management more amenable to fully funding these plans to protect all retirees longer term.
Even though the current Cooper/Apollo deal is dead, our job will continue. We will monitor performance of the current and future retiree pension plan and promote fair and equitable treatment, protection, and distribution of current and future retiree pension plan funds whether Cooper remains and independent company or is acquired by another entity. Our job will only be completed when we know all retirees are fully protected.
CRO Board of Directors