Cummins finalizes Meritor acquisition
05 August 2022
Earlier this year, Cummins announced it would acquire Meritor Inc. for approximately $3.7 billion, a move that would “position Cummins as a leading provider of integrated powertrain solutions across internal combustion and electric power applications,” the company stated. That acquisition is now complete, adding further to Cummins already extensive power solutions portfolio.
Based in Troy, Mich., Meritor has more than 9600 employees delivering drivetrain, mobility, braking, aftermarket and electric powertrain solutions for the commercial vehicles and industrial markets. Because it believes ePowertrains will be a critical integration point within hybrid and electric drivetrains, Cummins intends to accelerate Meritor’s investment in electrification and integrate development within its New Power business.
Jennifer Rumsey, Cummins president and CEO, commented: “We are excited to welcome Meritor’s employees into Cummins. Together, Cummins and Meritor will move further and faster in developing economically viable decarbonized powertrain solutions that are better for people and our planet.”
The acquisition of Meritor also adds products to Cummins’ components business that present growth significant opportunities. Cummins plans to accelerate the growth of the core axle and brake businesses by serving commercial truck, trailer, off-highway, defense, specialty and aftermarket customers globally.
“Cummins can help grow Meritor’s core business given our sales and service network and customer relationships around the world, and this acquisition has clear synergies for both companies that will position us for future investments during our industry’s technology transition,” said Tom Linebarger, Cummins executive chairman.
As previously announced, the acquisition of Meritor is expected to generate annual pre-tax run-rate synergies of approximately $130 million by year three after closing, expected to be comprised of, among other things, SG&A savings, supply chain operations and facilities optimization.