TROY, Mich. – Meritor Automotive and Arvin Industries have announced plans to merge their businesses, creating a global automotive supplier with 121 plants and 36,500 employees in 25 countries.

The new company, to be called ArvinMeritor, Inc., will have combined revenues of US $7.5 billion, and be incorporated in Indiana with corporate headquarters in Troy, Mich. Operating units will remain in their current locations.

Arvin shareholders will receive one share of ArvinMeritor common stock plus $2 of cash consideration for each share of Arvin common stock. (All figures in US dollars.) Meritor shareholders will receive 0.75 shares of ArvinMeritor common stock for each share of Meritor common stock. Meritor shareholders will own approximately 65.8 per cent and Arvin shareholders will own approximately 34.2 per cent of the combined company’s shares.

Except for cash received, the transaction will be tax free to the shareholders of both companies, and the transaction will be accounted for using the purchase method. The new company’s fiscal year will end Sept. 30.

Larry Yost, chairman and CEO of Meritor, will be the new company’s chairman and CEO. Bill Hunt, chairman and CEO of Arvin, will serve as the new company’s vice-chairman and president.

Together they will oversee the company’s corporate staff, as well as the operations of its six business groups, which include heavy vehicle systems, light vehicle systems, exhaust systems, light vehicle aftermarket, heavy vehicle aftermarket and coil coating.

The board of directors will include nine members from the current Meritor board and nine members from the current Arvin board, plus one new independent director agreed upon by the parties.

For more information, surf to www.meritorauto.com, or www. arvin.com. n