Meritor Inc. has an agreement to buy AxleTech for approximately $175 million, an addition that will expand its portfolio of commercial vehicle drivetrain products with an array of suspension, axle, braking, and drivetrain components for the off-highway, defense, specialty vehicle, and aftermarket categories.
The buyer said the purchase will advance its objective to accelerate global sales and growth in adjacent markets, namely the off-highway, defense, specialty and aftermarket segments. Meritor manufactures drivetrain, mobility, braking, and aftermarket products for commercial vehicle and industrial markets.
Meritor expects to realize over $15 million in annual cost synergies by FY 2022. It plans to finance the purchase through a cash and debt combination, and intends to close the deal later this year, subject to regulatory approvals and customary closing conditions.
The seller is an affiliate of the Carlyle Group, a private-equity holding company that controls General Dynamics Corp., the parent company of AxleTech.
Both companies are headquartered in Troy, MI.
AxleTech was established in 2003 and has manufacturing and distribution facilities in Oshkosh, Wisconsin; Detroit, Michigan; St. Etienne, France; and Osasco, Brazil. "We believe that Meritor's deep understanding of the business and best-in-class capabilities are a natural fit to support AxleTech's next growth phase," stated Bill Gryzenia, CEO.