Eaton and Cummins Inc. Announce Joint Venture for Automated Transmissions for Heavy- and Medium-Duty Commercial Vehicles
April 10 2017 - 9:00AM
Business Wire
Power management company Eaton (NYSE:ETN) and global power
leader Cummins Inc. (NYSE:CMI) today announced an agreement to form
a joint venture for automated transmissions for heavy-duty and
medium-duty commercial vehicles. The joint venture will be named
Eaton Cummins Automated Transmission Technologies.
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Cummins and Eaton will each own 50 percent of the new joint
venture. The formation of the joint venture is subject to
regulatory approvals and customary closing conditions. The parties
expect the transaction to close in the third quarter of 2017.
Cummins will consolidate joint venture results as part of its
Components business segment.
“Customers are focused on powertrain solutions that provide the
best combination of technology, performance and quality,” said
Craig Arnold, Eaton chairman and chief executive officer. “Our
joint venture with Cummins will leverage the technical strengths
and experience of two industry leaders with long histories and deep
industry expertise to provide superior automated transmission
technology for our global customers.”
“Our growth strategy includes expanding our product offerings
and extending our global footprint by becoming the world’s leading
powertrain supplier,” said Tom Linebarger, chairman and CEO,
Cummins Inc. “Our JV with Eaton will deliver the most advanced
automated transmissions and develop an integrated powertrain and
service network that supports our customers like never before. Just
as we've done for the past 100 years, we will use our experience in
partnerships and technological expertise to ensure our customers'
success.”
The global joint venture will provide customers with
industry-leading transmission technologies and solutions that
deliver best-in-class fuel efficiency, performance and uptime while
leveraging both Cummins’ and Eaton’s global service and support
networks. The joint venture will design, assemble, sell and support
all future medium-duty and heavy-duty automated transmissions for
the commercial vehicle market. Eaton’s current medium-duty
automated transmission, Procision®, and next generation heavy-duty
automated transmissions, will be part of the joint venture. In
addition, the joint venture will market, sell, and support Eaton’s
current generation of automated heavy-duty transmissions to OEM
customers in North America.
Eaton’s Vehicle Group will retain its global manual transmission
business, global clutch business, current generation medium-duty
and heavy-duty automated transmission business outside of North
America, global aftermarket business, light-duty transmission
business, agricultural transmission business, and global automotive
business and associated product lines.
Under the terms of the agreement, Eaton will receive $600
million in cash from Cummins for 50 percent interest in the joint
venture.
Conference Call with Eaton Management at 1:00 p.m. Eastern,
April 10, 2017
Eaton’s conference call to discuss the joint venture is
available to all interested parties as a live audio webcast today
at 1 p.m. United States Eastern time via a link on the center of
Eaton’s home page. This news release can be accessed under its
headline on the home page. An audio replay of the webcast will be
available at the same link.
Cummins leadership will comment further on the joint venture and
answer investor questions during its Q1 2017 Earnings call on May 2
at 10 a.m. ET.
About Eaton
Eaton is a power management company with 2016 sales of $19.7
billion. We provide energy-efficient solutions that help our
customers effectively manage electrical, hydraulic and mechanical
power more efficiently, safely and sustainably. Eaton is dedicated
to improving the quality of life and the environment through the
use of power management technologies and services. Eaton has
approximately 95,000 employees and sells products to customers in
more than 175 countries. For more information, visit Eaton.com.
About Cummins
Cummins Inc., a global power leader, is a corporation of
complementary business segments that design, manufacture,
distribute and service diesel and natural gas engines and related
technologies, including fuel systems, controls, air handling,
filtration, emission solutions and electrical power generation
systems. Headquartered in Columbus, Indiana, (USA) Cummins
currently employs approximately 55,400 people worldwide and serves
customers in approximately 190 countries and territories through a
network of approximately 600 company-owned and independent
distributor locations and approximately 7,400 dealer locations.
Cummins earned $1.39 billion on sales of $17.5 billion in 2016.
Press releases can be found on the Web at www.cummins.com. Follow
Cummins on Twitter at www.twitter.com/cummins and on YouTube at
www.youtube.com/cumminsinc.
This news release contains forward-looking statements about the
future Eaton Cummins Automated Transmission Technologies joint
venture. These statements should be used with caution and are
subject to various risks and uncertainties, many of which are
outside of either company’s control. The following factors could
cause actual results to differ materially from those in the
forward-looking statements: unanticipated changes in the joint
venture’s markets; unanticipated downturns in business
relationships with customers; the introduction of competing
technologies; unexpected technical or marketing difficulties;
unexpected claims, charges, litigation or dispute resolutions;
strikes or other labor unrest; unanticipated difficulties achieving
the customary closing conditions to which the transaction remains
subject; new laws and governmental regulations; and unanticipated
deterioration of economic and financial conditions in the United
States and around the world. We do not assume any obligation to
update these forward-looking statements.
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Eaton CorporateScott Schroeder, +1-440-523-5150orEaton Vehicle
GroupJim Michels, +1-248-226-6806orCummins Inc.Jon Mills,
+1-317-658-4540
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