Cummins to acquire parts of Faurecia commercial vehicle exhaust business in Europe and the United States.
Cummins Inc. (NYSE: CMI) announced it has entered into a definitive agreement with Faurecia, a company of the FORVIA Group, to purchase two of Faurecia’s commercial vehicle manufacturing plants and their related activities for EUR142 million. The manufacturing facilities are located in Columbus, Indiana (U.S.), and Roermond, Netherlands.
Cary Chenanda, Vice President of Cummins Emission Solutions, said:
Cummins and Faurecia have a long partnership history.
“This proposed acquisition would enable both organizations to meet long-term strategic goals and would preserve business operations and employment for talented employees within the two plants and related tech centers, while creating value for customers and suppliers across the entire supply chain.”
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“Cummins is committed to meeting or exceeding global emissions regulations now and in the coming years, and I am energized by this unique opportunity to gain experienced technical and manufacturing resources that would carry us far into the future.”
Chenanda continued, “I appreciate Faurecia’s engagement and attentiveness during the due diligence process, and I believe this potential acquisition would be in the sound interest of all parties. We are excited to build relationships with new customers and suppliers. Signing this agreement marks a significant milestone in our partnership with the Roermond and Columbus facilities, but it does not change our relationship in other global locations. We will maintain ongoing relationships with Faurecia in Brazil, China, India and South Africa.”
Strategic Rationale
Faurecia has been a partner and supplier to Cummins for more than a decade, and the FORVIA Group’s divestment initiatives offered Cummins an opportunity to ensure the long-term supply of aftertreatment components and assemblies. The acquisition adds significant technical and manufacturing resources and enhances Cummins’ existing mixer portfolio. These assets position Cummins’ Emission Solutions business for long-term success.
Cummins is committed to honoring Faurecia’s existing supplier and customer contracts in both facilities and will, following closing of the transaction, make the necessary investments to deliver on the contracts. Cummins and the Columbus South and Roermond plants remain separate entities today and will continue to operate independently of each other until the acquisition closes.
Cummins intends to finance the transaction using cash on the company’s balance sheet.
The transaction, which is subject to customary closing conditions, receipt of applicable regulatory approvals in the United States, Germany and the Netherlands, and favorable completion of the consultation process with the works council and trade unions in Roermond, is expected to close by the end of the calendar year.
About Cummins Inc.
Cummins Inc., a global power technology 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 internal combustion, electric and hybrid integrated power solutions to components including filtration, aftertreatment, turbochargers, fuel systems, controls systems, air handling systems, automated transmissions, electric power generation systems, microgrid controls, batteries, electrolyzers and fuel cell products.
Headquartered in Columbus, Indiana (U.S.), since its founding in 1919, Cummins employs approximately 73,600 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 $2.2 billion on sales of $28.1 billion in 2022. Learn more at cummins.com.
About FORVIA, whose mission is: “We pioneer technology for mobility experiences that matter to people”.
FORVIA comprises the complementary technology and industrial strengths of Faurecia and HELLA. With over 290 industrial sites and 76 R&D centers, 157,000 people, including more than 15,000 R&D engineers across 40+ countries, FORVIA provides a unique and comprehensive approach to the automotive challenges of today and tomorrow.
Composed of 6 business groups and a strong IP portfolio of over 14,000 patents, FORVIA is focused on becoming the preferred innovation and integration partner for OEMS worldwide. FORVIA aims to be a change maker committed to foreseeing and making the mobility transformation happen. www.forvia.com
ABOUT Faurecia
Faurecia, a company of the FORVIA Group, is a global automotive technology leader. In 2022, the Group reported consolidated sales of €25.5 billion. Faurecia is listed on the Euronext Paris market and is a component of the CAC Next 20, CAC 40 ESG and CAC SBT 1.5° indexes. www.faurecia.com
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Cummins to Acquire Parts of Faurecia’s Commercial Vehicle Exhaust Business in Europe and the United States, Columnis, Indi., May 23, 2023
