COLUMBUS, Ind.–(BUSINESS WIRE)–Global power and technology leader, Cummins today announced that it has completed its acquisition of Meritor, a leading global supplier of drivetrain, mobility, braking, aftermarket and electric powertrain solutions for commercial vehicle and industrial markets.
The integration of Meritor’s people, products and capabilities in axle and brake technology will position Cummins as a leading provider of integrated powertrain solutions across internal combustion and electric power applications. As demand for decarbonized solutions accelerates, ePowertrains will be a critical integration point within hybrid and electric drivetrains creating packaging and performance differentiation and the opportunity to provide advanced clean mobility products for customers. Cummins intends to deliver market-leading decarbonized solutions to global customers by accelerating Meritor’s investment in electrification and integrating development within its New Power business.
The acquisition of Meritor also adds products to Cummins’ components business that present attractive growth opportunities across the Company’s range of power solutions and applications. Cummins expects to utilize its global footprint to accelerate the growth of these core axle and brake businesses by serving commercial truck, trailer, off-highway, defense, specialty and aftermarket customers around the world.
“We are excited to welcome Meritor’s employees into Cummins,” said Jennifer Rumsey, Cummins’ President and Chief Executive Officer. “Together, Cummins and Meritor will move further and faster in developing economically viable decarbonized powertrain solutions that are better for people and our planet.”
Tom Linebarger, Cummins’ Executive Chairman continued, “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. We are relentless in our focus on Destination Zero, our company strategy to achieve net-zero emissions, and will lead in the transition to decarbonized power. This acquisition is an important step in executing on our strategy.”
As previously announced, the acquisition of Meritor is expected to be immediately accretive to Cummins’ adjusted EPS and generate annual pre-tax run-rate synergies of approximately $130 million by year three after closing, anticipated to be comprised of, among other things, SG&A savings, supply chain operations and facilities optimization. Cummins financed the acquisition, which had a total transaction value of approximately $3.7 billion, including assumed debt and net of acquired cash, using a combination of cash on the Cummins balance sheet, commercial paper and debt. The company remains committed to maintaining its strong credit ratings.
About Cummins Inc.
Cummins Inc., a global power leader, is a corporation of complementary business segments that design, manufacture, distribute and service a broad portfolio of power solutions. The company’s products range from diesel, natural gas, electric and hybrid powertrains and powertrain-related components including filtration, aftertreatment, turbochargers, fuel systems, controls systems, air handling systems, automated transmissions, electric power generation systems, batteries, electrified power systems, hydrogen generation and fuel cell products. Headquartered in Columbus, Indiana (U.S.), since its founding in 1919, Cummins employs approximately 59,900 people committed to powering a more prosperous world through three global corporate responsibility priorities critical to healthy communities: education, environment and equality of opportunity. Cummins serves its customers online, through a network of company-owned and independent distributor locations, and through thousands of dealer locations worldwide and earned about $2.1 billion on sales of $24.0 billion in 2021. See how Cummins is powering a world that’s always on by accessing news releases and more information at https://www.cummins.com/always-on.