Apollo Tyres Ltd., India’s second- biggest tiremaker by market value, agreed to acquire Cooper Tire & Rubber Co. for about $2.5 billion for greater access to the U.S. automotive market.

Apollo Tyres, based in Gurgaon, India, agreed to pay $35 a share to stockholders of Cooper Tire. That’s 43 percent higher than yesterday’s closing price of $24.56. Cooper Tire shares rose 41 percent to $34.70 at 9:39 a.m. New York time.

Apollo Tyres, which last month agreed to sell most of its South African operations to Sumitomo Rubber Industries Ltd. for $60 million, is looking to expand beyond India and Europe to meet its goal to be among the top 10 tiremakers in the world by 2016. Automobile demand in both India and Europe has slowed amid weaker economic expansion. Deliveries in the U.S., the second- biggest auto market, are on pace for its best year since 2007.

The acquisition will provide “scale and geographical presence including the American and European market, that’s a mature market, and India and China that’s a growing market,” Neeraj Kanwar, vice chairman of Apollo Tyres, told reporters at a briefing in Gurgaon.

The deal would be the biggest takeover of an auto-parts maker since 2007, according to data compiled by Bloomberg.

Apollo Tyres and Findlay, Ohio-based Cooper Tire will borrow money from four banks, Apollo Tyres Chief Financial Officer Sunam Sarkar said at the briefing. The two companies will jointly raise $2.5 billion from the sale of bonds with maturity of up to eight years, he said.

Apollo Tyres’s exposure to new debt will be be about $450 million, Sarkar said. The companies will also raise some funds with asset-backed loans, he said.

The four banks that will help arrange the funds are Standard Chartered Plc, Morgan Stanley, Deutsche Bank AG and Goldman Sachs Group Inc., according to a joint statement issued by the two companies.

Sullivan & Cromwell LLP and Amarchand & Mangaldas & Suresh A Shroff & Co. served as legal advisers to Apollo Tyres. BofA Merrill Lynch served as financial adviser and Jones Day served as legal adviser to Cooper Tire, according to the statement.

Shares of Apollo Tyres rose 2.7 percent to close at 91.95 rupees in Mumbai, before the announcement. They have advanced 3.3 percent this year, compared with a 2 percent drop in the benchmark S&P BSE Sensex.

Cooper Tire fell 3.2 percent this year through yesterday, compared with a 16 percent increase for the Russell 2000 Index.

For more automotive coverage, see "LKQ Grabs Auto Parts Co. for $268M," “Winners of the Auto Aftermarket,” “Express Oil's Second Time Around with Carousel” and “Jalopy Deals Remain Hot.”

Manufacturing industry