ArvinMeritor to spin off light vehicle systems business

By Lisa Kerner

Charlotte, N.C., May 6 - ArvinMeritor, Inc. said it plans to spin off its light vehicle systems business to ArvinMeritor shareholders through a pro rata tax-free dividend.

The spinoff is expected to be completed within the next 12 months, according to a company news release.

ArvinMeritor shareholders will own 100% of the common stock of the spun off company, which will be known as Arvin Innovation, Inc. and will be based in Detroit.

The commercial vehicle systems business will remain with ArvinMeritor, the company said.

"The plan to separate our two businesses is the result of a comprehensive strategic review to enhance the company's long-term value for our shareholders," chairman, chief executive officer and president Chip McClure said in the release.

"Each company will benefit from a greater strategic focus on its core business and growth opportunities as well as from increased recognition in each of its global market segments," McClure added.

McClure will remain as ArvinMeritor's chairman, CEO and president. ArvinMeritor board member James Marley will lead Arvin Innovation's board of directors as non-executive chairman.

Phil Martens, currently ArvinMeritor's senior vice president and president, light vehicle systems, will become the president and CEO of Arvin Innovation.

ArvinMeritor's common stock will continue to trade on the New York Stock Exchange under the symbol "ARM," while Arvin Innovation, once approved, is expected to trade on the Nasdaq under the symbol "ARVI."

J.P. Morgan Securities Inc. is ArvinMeritor's lead financial adviser for the spinoff.

ArvinMeritor, located in Troy, Mich., provides a range of integrated systems, modules and components to the motor vehicle industry.

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