Goodyear/USW retirement benefits agreement now fully settled as appeal period passes

Goodyear is now officially free to remove more than $1 billion in financial liabilities for its United Steel Workers’ retiree health care benefits from the company’s balance sheet.

A 30-day period for any interested parties to appeal a U.S. District Court order approving an Aug. 22 settlement establishing the Voluntary Employees’ Beneficiary Association trust (VEBA) has expired without any appeals being filed. Following a Goodyear $1 billion contribution, the VEBA will henceforth be administered by the union.

Also, the company says it intends to draw $600 million from its existing U.S. revolving credit resources due to “a temporary delay” in its ability to access $360 million of cash currently invested with the Reserve Primary Fund.

The Reserve Primary Fund, a money market endeavor, has delayed the payment of requested redemptions “pursuant to a Securities and Exchange Commission order allowing an orderly disposition of its securities,” Goodyear executives report, noting that “this action was the catalyst for the company’s decision to draw the facility at this time.”

The funds also will be used “to support seasonal working capital needs and to enhance the company’s cash liquidity position.”

Goodyear’s other U.S. cash investments remain fully accessible, according to the company.

For more information, visit www.goodyear.com/corporate.