In a historic move, Goodyear Tyre & Rubber Company has agreed to sell the iconic Dunlop brand to Japan’s Sumitomo Rubber Industries (SRI), marking the end of nearly four decades of complex agreements, legal disputes, and corporate negotiations. The deal, pending regulatory approval, is expected to close by the end of the year and grants Sumitomo full ownership of the Dunlop brand, including its manufacturing rights.

This acquisition further strengthens SRI’s portfolio, which includes notable brands such as Falken and Ohtsu Tires. With Dunlop’s storied legacy and global recognition, the brand is set to become a centrepiece of SRI’s tyre empire.

The Deal Details
According to Powersports Business, Goodyear will receive approximately $701 million in cash from SRI for the transaction, which includes:

• The transfer of the Dunlop brand across relevant geographies.
• A “Transition Fee” for supporting the handover process.
• The purchase of Dunlop tire inventory.
  The deal also establishes ongoing arrangements for licensing, offtake agreements, and other specialized provisions to ensure a seamless transition.

Untangling the Backstory
Dunlop’s journey through corporate hands began in 1985 when Sumitomo acquired the rights to the brand, along with its manufacturing and marketing privileges, but not the company itself. In a twist, Goodyear later entered a partnership with Sumitomo, gaining the right to use the Dunlop name while acquiring a 75% stake in Sumitomo’s North American and European operations.

The partnership unravelled in 2014, with Goodyear accusing Sumitomo of anti-competitive practices. By 2015, the alliance was officially dissolved, with Sumitomo regaining control of Dunlop’s motorcycle tyre division, which ceased operations last year. However, shared rights and ownership complexities lingered, muddying the brand’s future until this landmark agreement.

Strategic Moves for Both Parties

For Goodyear, selling Dunlop aligns with its broader transformation strategy, aimed at streamlining operations and focusing on more profitable ventures. This decision allows the company to exit a prolonged entanglement while generating $701 million in cash and additional revenues from transition fees and inventory sales.

For Sumitomo, fully owning the Dunlop brand is a game-changing strategic boost. This acquisition enhances SRI’s global footprint, positioning Dunlop as a cornerstone of its tyre empire. With the deal set to close by the end of the year, Sumitomo is poised to capitalise on Dunlop’s legacy, strengthening its competitive edge in the global tyre industry.

As the dust settles on this decades-long saga, Dunlop’s future under SRI promises a streamlined and focused path, leaving behind the complexities of its corporate past.