Auto Parts Maker Arvin Meritor Up 17% on Asset Sale

Auto parts maker Arvin Meritor (Short for ARM) this afternoon said it would sell off a third business unit, a light-vehicle chassis business, as part of its attempt to cut costs dramatically amidst the economic downturn. The company will sell its Gabriel Ride Control Products North America business for undisclosed terms to private equity firm OpenGate Capital, which owns, among other things, French paper Le Monde, and TV Guide.

 

The announcement has driven up Arvin Meritor shares 69 cents, or 17.5%, to $4.63, making it the third-highest climber today on the New York Stock Exchange. Fellow parts maker TRW Automotive Holdings (TRW), which was upgraded this morning by J.P. Morgan, is the top gainer, up 26%.

 

The sale completes the divestiture of units representing 72% of the company’s total sales, including $117 million, Arvin Meritor said.

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