Goodyear Restructuring

Includes a company with a strong, successful, well-defined product-market strategy. In 1982, this strategy has been extended by new management to be other conflicting objectives. This has a direct negative impact on the stock market, the evaluation of Goodyear’s stock, attracting the attention of corporate raider Sir James Goldsmith. In an attempt to ensure the independence, Goodyear management responds by returning the company to its previous investment strategy: sell new investment dramaticall … Read more »

Includes a company with a strong, successful, well-defined product-market strategy. In 1982, this strategy has been extended by new management to be other conflicting objectives. This has a direct negative impact on the stock market, the evaluation of Goodyear’s stock, attracting the attention of corporate raider Sir James Goldsmith. In an attempt to ensure the independence, Goodyear management responds by returning the company to its previous investment strategy: sell new investment dramatically increasing debt and buy back stock. The case highlights that the company is particularly vulnerable to a takeover attempt with the greatest potential value appreciation.
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from
Paul Asquith
Source: Harvard Business School
16 pages.
Release Date: 18, March 1988. Prod #: 288046-PDF-ENG
Goodyear Restructuring HBR case solution