Elliott Management Goodyear Turnaround Plan

Elliott Management's turnaround plan for Goodyear involves significant cost-cutting measures, including a 14% reduction in global headcount.

Goodyear's cost structure is a major area of focus for Elliott Management, with the activist investor pushing for a more streamlined organization.

The plan also includes a $1 billion reduction in annual operating costs, which will be achieved through a combination of cost-cutting measures and strategic investments.

Elliott Management is taking a hands-on approach to implementing the turnaround plan, with a team of experts working closely with Goodyear's management to identify areas for improvement.

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Goodyear's Turnaround was a remarkable transformation under Elliott Management's leadership. Elliott Management acquired a 9.7% stake in Goodyear in 2019, signaling a major shift in the company's fortunes.

Elliott Management's activist approach led to the appointment of a new CEO, Richard Kramer, who was tasked with implementing a comprehensive turnaround plan. Kramer's experience in the industry proved invaluable in driving change.

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The company's debt-to-EBITDA ratio was a major concern, standing at 4.7 times in 2019. This was significantly higher than the industry average, making it a prime target for cost-cutting measures.

Elliott Management's influence led to a major restructuring effort, resulting in the elimination of 10% of Goodyear's workforce. This move was aimed at reducing costs and improving operational efficiency.

The company's stock price had been stagnant for years, but under Elliott Management's guidance, it began to recover. By 2020, the stock had risen by over 50% from its 2019 levels.

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Elliott Associates is a successful and astute activist investor, particularly in the technology sector.

Their team includes analysts from leading tech private equity firms, engineers, operating partners – former technology CEO and COOs.

Elliott often watches companies for many years before investing and has an extensive stable of impressive board candidates.

They also hire specialty and general management consultants, expert cost analysts and industry specialists when evaluating an investment.

Elliott issued a letter and presentation to Goodyear's board on May 11, urging the company to appoint five new independent directors.

They also recommended monetizing the company-owned store network and forming an operational review committee to develop an operational and margin improvement plan.

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