By DANIEL KELLEY - WILMINGTON, Del. -- A special judge will begin hearing arguments today in the stalled $2.5 billion buyout of Cooper Tire and Rubber Co. by India's Apollo Tyres Ltd. in a case that could decide if the companies are forced to merge or go their separate ways.

By DANIEL KELLEY - WILMINGTON, Del. -- A special judge will begin hearing arguments today in the stalled $2.5 billion buyout of Cooper Tire and Rubber Co. by India's Apollo Tyres Ltd. in a case that could decide if the companies are forced to merge or go their separate ways.

In addition to Apollo's control of the 99-year-old Cooper, at stake could be Cooper's largest tire plant in China, the job security and pensions of Cooper's American workers, and the shareholder values of both companies.

Since Cooper sued Apollo on Oct. 4 in the Delaware Court of Chancery to force it to complete the deal, attorneys for both companies have reviewed about 230,000 pages of documents, and have interviewed witnesses in London, New York, Cleveland, Pittsburgh and Detroit.

Cooper claims Apollo has been dragging its feet after criticism of the deal, announced June 12, sparked a case of buyer's remorse.

It wants court Vice Chancellor Sam Glasscock III to force Apollo to complete the merger. Cooper is incorporated under Delaware law.

Apollo charges Cooper has lost control of its huge Cooper Chengshan (Shandong) Tire Co. plant in China, where Cooper management has been denied access to the property and to the financial records that Apollo says it needs to obtain financing for the deal. Chinese workers say they oppose a takeover by Apollo.

A merger would create the world's seventh-largest tire company. For Apollo, a successful deal could mean access to markets in North America and China.

Its efforts to buy Cooper Tire began in August 2012 when it offered $22.75 per share for Cooper stock. Cooper management rejected that deal, but Apollo came back three more times before Cooper accepted an offer of $35 per share in April, a 40 percent premium over its average price that month.

When the firms announced the merger in June, Apollo faced steep criticism, in part because the deal was financed entirely by debt. It had a 25 percent decline in its stock price on the India market the following day.

The price of Apollo's shares continued to fall until June 28, when they bottomed out after a 39 percent decline.

Eight days after that, the Chinese workers went on strike for nearly a month. Cooper owns 65 percent of the Chinese factory. When workers returned, they refused to make Cooper-branded products and barred Cooper managers from the plant.

Separately, the United Steelworkers of America union, seeking reassurances about promised pensions and benefits, filed a grievance against the merger.

The union said its collective bargaining agreement contains a provision forcing any buyer of Cooper to recognize the union before completing a merger.

An arbitrator agreed, and issued an order blocking the deal until Apollo reached an agreement with the union.

In October, Cooper sued in Delaware, arguing that Apollo was barely negotiating with the USW. Cooper contends that Apollo is using the union talks to either back out of the merger without incurring a $112 million penalty, or to renegotiate the $35 per share price.

Apollo has responded in court documents that Cooper was not telling the truth when it said it had control of all its assets, a contention that explicitly references the situation in China.

But Cooper says its merger agreement foresaw the possibility of labor strife, and therefore Apollo shouldn't be able to use those issues to back out.

Subscribe to The Courier.