Cooper Tire & Rubber Co. announced early this morning that it has decided to terminate its merger agreement with Apollo Tyres.

"It is time to move our business forward," said Roy Armes, Cooper CEO and president, in a statement released by the tiremaker.

“While the strategic rationale for a business combination with Apollo is compelling, it is clear that the merger agreement both companies signed on June 12 will not be consummated by Apollo, and we have been notified that financing for the transaction is no longer available. The right thing for Cooper now is to focus on continuing to build our business.”

The tiremaker addressed its investors following the decision in a webcast. During the webcast, Cooper said it chose to terminate the agreement instead of waiting for it to expire because it allows the company to move forward and grow its business.

Armes said the focus now will be on addressing the situation at Cooper Chengshan Tire (CCT) in Rongcheng, China.

"Once the situation at CCT is resolved and regular financial reporting has resumed, Cooper will be in a position to address additional options for the deployment of capital targeted at returning value for our stockholders," he said.

While the tiremaker did not take any live questions, it addressed several questions it had been receiving from investors.

Cooper said it never received a proposal from Apollo to sell the company for a lower share cost that had proper financing or a proposal that didn’t have financial risk for Cooper. It also said the termination of the deal should not affect the USW as the groups signed two contracts; one for if the merger succeeded and one for it if fell through.

The tiremaker also noted that it doesn’t believe it will be responsible for the $50 million termination fee and still believes Apollo breached its merger agreement. Cooper will continue to pursue action against Apollo for damages, as well as the reverse termination fee, to protect the interests of the company and its shareholders, it said.

In response to the termination, Apollo said it was disappointed the Cooper prematurely attempted to terminate the merger.

 “While Cooper’s lack of control over its largest subsidiary and inability to meet its legal and contractual financial reporting obligations has considerably complicated the situation, Apollo has made exhaustive efforts to find a sensible way forward over the last several months, however, Cooper has been unwilling to work constructively to complete a transaction that would have created value for both companies and their shareholders. Cooper’s actions leave Apollo no choice but to pursue legal remedies for Cooper’s detrimental conduct,” the company said. “Importantly, Apollo has many other compelling growth opportunities around the world that we are continuing to pursue. Our business is performing well — as evidenced by the strong top and bottom line results we reported last quarter — and we remain focused on executing our standalone strategic plan to maximize value for Apollo’s shareholders. We are confident that Apollo is well-positioned for continued success.”