ArvinMeritor Inc. announced Friday that it has signed a definitive agreement to sell its Emissions Technologies business group to One Equity Partners (OEP), an equity investment firm based in New York.
Cash and other consideration total approximately $310 million. The transaction is expected to be completed in the third quarter of fiscal year 2007.
“The decision to sell our Emissions Technologies business is part of our long-term strategy to refocus our company and concentrate on the strengths and core competencies that will generate future earnings growth for ArvinMeritor,” said Chairman, CEO and President Charles G. “Chip” McClure. “The proceeds from this sale will support our continued efforts to strengthen our balance sheet, and increase our ability to invest in technology, research and development that more closely aligns with our strategic focus on selected vehicle systems.”
“By focusing on and investing in our light and commercial vehicle businesses where we have superior products, strong market positions and higher margins, we see greater potential for sustained profitable growth in our core capabilities,” McClure said. These include:
• Chassis – vehicle stability (ride and handling – braking and suspension systems and wheels)
• Drivetrain – vehicle propulsion (steer axles, drivelines, suspensions, trailer axles and all-wheel drive systems and hybrids)
• Apertures – vehicle safety and security (body and control systems, such as doors and roofs).
“We continue to be committed to diversifying our customer base, expanding our global presence and strengthening our product portfolio in areas that provide the highest value to our customers and return the greatest value to our shareowners,” McClure continued.
“In addition, we are implementing an aggressive strategy in Asia, and committing resources to sustainable and profitable growth in this region,” said McClure. “We also are planning to increase our global aftermarket and specialty businesses, and we are funding advanced engineering, research and development initiatives that will better position us for the challenges ahead.”
“While we are confident in the growth potential of the emissions technologies portfolio, we believe that this business will be better served by an organization that is specifically positioned to invest capital and management resources in its development and growth,” McClure added.
"OEP is looking forward to working with the Emissions Technologies management team to execute a focused and aggressive growth plan,” said Lee Gardner, OEP senior partner. “We believe that the worldwide push to reduce pollutants and greenhouse gas emissions will create long-term opportunities for companies focused on advanced exhaust and emissions technology, and we are very pleased to be acquiring a leading company in this industry"
The Emissions Technologies business is a leader in the global emission technology industry, serving worldwide light and commercial vehicle manufacturers. The business has operations in 19 countries, 7,500 employees and several long-term joint venture relationships. H. H. "Buddy" Wacaser, President of Emissions Technologies, and his management team will continue to lead it following the close of the transaction.
Once the transaction closes, the new Emissions Technologies company will have dual headquarters in Columbus, Ind., as well as in the metro Detroit area.
After the sale of its Emissions Technologies business, ArvinMeritor will have about 20,000 employees, with 75 facilities in 22 countries.