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Cummins Closes USD 3.7bn Acquisition of Axle and Brake Supplier Meritor.

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Vincent

MANews-(C)2009-2022

US-based diesel engine maker Cummins Inc. (NYSE: CMI) has closed its acquisition of US-based drivetrain, mobility, braking, aftermarket and electric powertrain solutions provider Meritor, Inc. (NYSE: MTOR), the company said.

Meritor serves commercial vehicle and industrial markets.

Under the terms of the agreement, Cummins paid USD 36.50 in cash per Meritor share, for a total transaction value of approximately USD 3.7 bn, including assumed debt and net of acquired cash.

Meritor is in axle and brake technology. The integration of Meritor's people, technology and capabilities will position Cummins as one of the few companies able to provide integrated powertrain solutions across combustion and electric power applications.

Cummins said it believes eAxles will be a critical integration point within hybrid and electric drivetrains. By accelerating Meritor's investment in electrification and integrating development within its New Power business, Cummins expects to deliver market-leading solutions to global customers.

Meritor has a legacy dating back more than 110 years. The company, which is headquartered in Troy, MI, has more than 9,600 employees serving commercial truck, trailer, off-highway, defense, specialty and aftermarket customers around the world.

The acquisition of Meritor is expected to be immediately accretive to Cummins' adjusted EPS and is expected to generate annual pre-tax run-rate synergies of approximately USD 130m by year three after closing.

Cummins plans to finance the transaction using a combination of cash on...

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