A merger three years ago of a pair of billion-dollar auto parts suppliers created the then-11th largest auto-parts company in the world, ArvinMeritor. A top executive of one of the firms said devalued stock of the two contributed to the joining.
A similar low value of Dana Corp.'s stock has contributed to the attempted $4.4 billion hostile takeover of the Toledo firm by ArvinMeritor, Inc., of Troy, Mich.
ArvinMeritor, with annual sales of $6.9 billion and 32,000 workers, is the result of a merger in 2000 of giants Arvin Industries of Columbus, Ind., and Meritor Automotive of Troy, Mich. It ranks at No. 266 on the Fortune 500 list, smaller than Dana at No. 182 but a big player in the auto parts industry.
Both pieces of ArvinMeritor had histories of growing through buyouts and each was a strong name in the industry.
Before the merger, Arvin Industries was the No. 2 maker of auto exhaust systems; shock absorbers for cars and trucks, and air, oil, and fuel filters. Meritor Automotive made its name through axles but also was a leader in roof, door, and body components, suspension systems, and wheel products.
Arvin began as Indianapolis Air Pump Co. in 1919, but a year later Richard Arvin sought a patent for a car heater. By 1950, it became Arvin Industries, specializing in mufflers and car heaters. Between 1974 and 1999, it acquired Schrader Automotive, which made valve tires and inner tubes; Maremont Corp., which made shock absorbers and exhaust systems, and Gabriel, which made shock absorbers. It also bought a shock absorber firm in Europe, gained access to European exhaust system markets, formed joint ventures in Asia, expanded its European holdings, and bought Purolator, which made filters and housings.
Meritor began in 1909 as Timken Detroit Axle but became Wisconsin Parts Co. in 1919. By 1953, it merged with other firms to form Rockwell Spring and Axle, which became North American Rockwell in 1967 with Rockwell Automotive as a division.
In 1973, Rockwell Automotive acquired Fumagalli, a maker of steel wheels. From 1974 to 1990, it focused on product development, introducing a line of axles, transmissions, and anti-lock braking system for tractor trailers. From 1993 through 1997, it acquired window regulator business from Dura Automotive and bought Skoda Boleslav, a components maker in the Czech Republic.
In 1997, Meritor was spun off from Rockwell and made three acquisitions: Volvo's heavy axle operations in Sweden; Euclid Industries, an aftermarket supplier of parts for trucks, trailers, tractors, and buses, and LucasVarity's heavy vehicle braking systems - before joining with Arvin in 2000.