In what’s being cheered as the largest M&A deal in India’s automotive history, Apollo Tyres has announced it will acquire US-based Cooper Tire & Rubber Company in an all-cash transaction valued at $2.5 billion or around Rs 14,500 crore.

The Gurgaon-based tyre major said on Wednesday that it would offer Cooper stockholders $35 per share in cash — a 40% premium — to buy back all the shares and delist the Ohio-headquartered company from the New York Stock Exchange.

The mega deal, which comes at a time when markets are depressed globally, will catapult Apollo from its 16th position in the global pecking order to being the 7th largest tyre company. It will have a footprint in both developing and developed markets, including the US and China, and churn out daily volumes of 3,500 tonne, double what it now clocks.

It will finance the deal through cash flows from its Indian operations and by leveraging that of Cooper Tire and Apollo’s European operations. “Around $450 million will be serviced out of India cash flows,” said Neeraj Kanwar, VC & MD, Apollo Tyres.