Divestitures

12 Months Ended

Dec. 31, 2025

Discontinued Operations and Disposal Groups [Abstract]

Divestitures

Divestitures

Net gains on asset sales were $816 million, $93 million and $104 million for the years ended December 31, 2025, 2024 and 2023, respectively. None of our divestitures meet the criteria for presentation as discontinued operations as they do not represent a strategic shift that will have a major effect on our operations or financial results.

On February 3, 2025, we completed the sale of our OTR tire business to The Yokohama Rubber Company, Limited (“Yokohama”) pursuant to the terms of the Share and Asset Purchase Agreement, dated as of July 22, 2024 (the “OTR Purchase Agreement”). In conjunction with the sale of the OTR tire business, we entered into several ancillary agreements, including a trademark license agreement, whereby we license certain trademarks to Yokohama for an initial period of ten years from the date of the sale, a product supply agreement, pursuant to which we supply to Yokohama certain OTR tires for an initial period of up to five years, and a transition services agreement, pursuant to which we are providing certain support services for a period of up to eighteen months. The activity related to these agreements is primarily recorded in Prepaid Expenses and Other Current Assets and Other Current Liabilities in the Consolidated Balance Sheets.

As a result of the transaction, considering the receipt of the purchase price of $905 million, subject to certain adjustments set forth in the OTR Purchase Agreement, amounts allocated to deferred income related to the trademark license agreement of $90 million, amounts allocated to deferred revenue related to the product supply agreement of $95 million, and transaction costs of $26 million, and based upon the net assets of the OTR tire business of $439 million, we recorded a pre-tax gain of $255 million. We estimated the fair value of the deferred income related to the trademark license agreement using the relief-from-royalty method, with the most critical assumptions based on projected revenue, royalty rate and discount rate. We estimated the fair value of the deferred revenue related to the product supply agreement using a cost-plus-margin approach, with the most critical assumption based on projected cost of goods sold. The pre-tax income from the assets sold included within the Consolidated Statements of Operations was $72 million and $69 million for the twelve months ended December 31, 2024 and 2023, respectively. These amounts exclude any ongoing obligations related to the product supply agreement and transition services agreement, as well as any amortization of deferred revenue or income.

On May 7, 2025, we completed the sale of our rights to the Dunlop brand in Europe, North America and Oceania for consumer, commercial and other specialty tires, together with certain associated intellectual property and other intangible assets, for a purchase price of $526 million to Sumitomo Rubber Industries, Ltd. ("SRI") pursuant to the terms of the Purchase Agreement, dated as of January 7, 2025 (as amended, the "Dunlop Purchase Agreement"). SRI also paid us an up-front transition support fee of $105 million for our support in transitioning the Dunlop brand, related intellectual property and Dunlop customers to SRI. SRI also acquired our existing Dunlop tire inventory for approximately $104 million. We also entered into a number of ancillary agreements, including (a) a transition license agreement, pursuant to which we continued to manufacture, sell and distribute Dunlop-branded consumer tires in Europe from the closing of the transaction until December 31, 2025, and during which we paid SRI a royalty on such Dunlop sales; (b) a transition offtake agreement, pursuant to which we will sell to SRI certain Dunlop-branded consumer tire products for a period of up to five years, commencing after termination or expiration of the transition license agreement; and (c) we will license back the Dunlop brand from SRI for commercial tires in Europe on a long-term basis, subject to a royalty on sales.

As a result of the transaction, we received gross proceeds of $735 million at closing for the Dunlop brand, related intellectual property and other intangible assets, the transition support fee and the tire inventory. We allocated $105 million of those proceeds related to the up-front transition support fee to deferred income, which will be recognized over the combined lives of the transition license and transition offtake agreements. We also allocated $86 million of those proceeds to deferred income for tire inventory in Europe, which will be recognized upon transfer of title. We recognized an estimated pre-tax gain of $385 million based on the net assets sold of $133 million during the second quarter of 2025, net of transaction costs of $26 million.

On October 31, 2025, we completed the $650 million sale of our polymer chemicals business (the “Chemical Business”) pursuant to the Asset Purchase Agreement (the “Chemical Purchase Agreement”) with G-3 Chickadee Purchaser, LLC, a Delaware limited liability company (the “Purchaser”). At the closing, we received gross cash proceeds of approximately $580 million, which reflects working capital adjustments, including an adjustment for intercompany receivables. The purchase price remains subject to customary post-closing adjustments as set forth in the Chemical Purchase Agreement.

The assets acquired and the liabilities assumed by the Purchaser are generally those primarily related to the Chemical Business, including our chemical plants in Houston, Texas and Beaumont, Texas and a research and development facility in Akron, Ohio.

In conjunction with the sale of the Chemical Business, we also entered into a number of ancillary agreements including (a) a master supply agreement, pursuant to which the Purchaser will, or will cause its affiliates to, supply to us certain polymer chemical products for a period of fifteen (15) years (the "Chemical Supply Agreement"), (b) a transition services agreement, pursuant to which we will provide certain transition services to the Purchaser for the Chemical Business for a period of up to eighteen (18) months, and (c) a patent and know-how license agreement, pursuant to which the Purchaser will license back to us certain intellectual property related to the Chemical Business for use in connection with certain retained businesses. The Chemical Supply Agreement is a take-or-pay contract which requires us to purchase minimum quantities on a quarterly basis.

As a result of the transaction, considering the purchase price and related working capital adjustments, including an adjustment for intercompany receivables, of $580 million, amounts allocated to deferred income of $110 million and transaction costs of $29 million, and based upon the net assets of the Chemical Business of $337 million, we recognized an estimated pre-tax gain of approximately $104 million during the fourth quarter of 2025.

Net gains on asset sales for the year ended December 31, 2025 also included a $55 million gain ($26 million after-tax and minority) related to the sale of property in Asia Pacific and a $12 million gain related to the sale of Commercial Tire and Service Centers in Americas. Net gains on asset sales for the year ended December 31, 2024 were $93 million, primarily related to the sale of a distribution center in EMEA. Net gains on asset sales for the year ended December 31, 2023 were $104 million, primarily related to gains on sale and leaseback transactions of $88 million, with the remainder relating to the sale and exit of certain retail locations in Americas.