ArvinMeritor Inc. on Monday, Sept. 21, announced that it has completed the previously announced sale of its Wheels business – formerly a division of the company’s Light Vehicle Systems segment – to Iochpe-Maxion S.A., a Brazilian producer of wheels and frames for commercial vehicles, railway freight cars and castings, for about $180 million.
The company expects to use the net proceeds of $169 million from the sale to reduce outstanding balances on its revolving credit facility in advance of its fourth fiscal quarter end. The company reiterated that it expects to remain in compliance with its financial covenant in the fourth quarter.
“We are pleased to have completed this transaction, which represents another step forward in our transformation to becoming a global commercial vehicle and industrial company with a focus on expanding our leadership position in both the on- and off-highway equipment and machinery markets,” says Chip McClure, chairman, chief executive officer and president of ArvinMeritor, based in Troy, Mich. “We look forward to using the proceeds from this sale to further strengthen our balance sheet and to invest in areas that will help us grow our core business and deliver value to our shareholders. We would like to thank the entire Wheels team for their dedication and hard work over many years and wish them much success in the future.”