Japan’s Bridgestone to Financially Support U.S. Subsidiary
TOKYO (AP) _ Bridgestone Corp., a major Japanese producer of rubber products, will help its financially troubled U.S. subsidiary by paying off $1.4 billion of its debts, a company official said Friday.
Toshiaki Yamamoto, a Bridgestone spokesman, said the funds, to be raised on capital markets, will be used for the repayment of a portion of the $3 billion in debts held by Bridgestone-Firestone Inc., its Ohio-based tire-making subsidiary.
With a reduction of the debt, Bridgestone-Firestone’s annual interest payments will be halved to about $120 million, Yamamoto said.
Yamamoto said the U.S. subsidiary’s deficit could thereby be trimmed to about $240 million this year from last year’s $350 million.
″We will aim to increase competitiveness, while carrying out sales of assets and personnel reductions″ in some sectors of the subsidiary to streamline its organization, Akira Ieiri, president of Bridgestone, was quoted as saying by the Nihon Keizai Shimbun newspaper.
Bridgestone acquired Firestone Tire and Rubber Co. for $2.6 billion in 1988.