USA: ArvinMeritor to sell two operations
ArvinMeritor plans to sell two businesses as it shifts focus to passenger- and commercial-vehicle systems for original equipment manufacturers.
Associated Press (AP) said the firm will divest its light-vehicle aftermarket business and its coil-coating subsidiary, Roll Coater Inc.
The company expects to take a goodwill impairment charge of $190 million, or $2.77 per share, in the fourth quarter from closing down the light-vehicle aftermarket division, the report added.
The units will be listed as discontinued operations when ArvinMeritor reports its fourth-quarter financial results on November 15 and the divestments are expected to be completed during the fiscal 2005 year, AP said.
"We believe these decisions are necessary steps to improve our financial flexibility and strengthen our long-term profitability," president, chief executive and chairman Charles McClure reportedly said in a statement.
ArvinMeritor plans to use the proceeds to strengthen its balance sheet and reinvest in its core light-vehicle and commercial-vehicle systems businesses. Lehman Brothers has been hired as an adviser for the selling process, the company said.
AP said the light-vehicle aftermarket group supplies exhaust systems, filters and ride and motion control products to retailers and major car companies, and had sales of more than $US800 million in 2003. The segment employs 5,000 at 21 facilities in seven countries.
Roll Coater has 500 workers at four US facilities, and reported sales of $200 million last year, the Associated Press said.