Meritor Inc., which manufactures commercial vehicle axles, brakes, suspensions, and drivetrain systems, agreed to sell its 50% stake in a Brazilian company, Suspensys Sistemas Automotivos Ltda., to its joint venture partner Randon S.A. Implementos e Participacoes.
According to reports, the sale will earn $195 million in cash for Meritor, plus other considerations. It is expected to close by the end of this year.
Suspensys Sistemas Automotivos was formed in 1997 to manufacture commercial vehicle axles and suspensions. Randon is a holding company for a series of manufacturing and service companies, mainly producing automotive and commercial vehicle parts.
The joint venture was formed in 2002 when Meritor and Randon together acquired Suspensys Sistemas, and the operation moved into a new manufacturing plant in 2003.
Its basic products are air and mechanical suspension systems for trucks, buses and trailers, trailer axles, third axles, hubs and drums for trucks, buses and trailers.
Meritor did not indicate its reasons for selling its stake, but it restated its commitment to the North American trailer business, and stated it expects to continue supplying “high-quality trailer products” to customers in the region.
"We are pleased to have entered into this agreement and look forward to using the proceeds from the sale to support our continued efforts to strengthen our balance sheet," according to Meritor chairman, president, and CEO Chip McClure.