The Timken Company (NYSE: TKR) today announced it completed the sale of its Needle Roller Bearings business to Japan's JTEKT Corporation.
Timken received approximately $330 million, including retained receivables, from the sale. These proceeds will be used for general company purposes, while also providing additional liquidity, bolstering the company's financial position in a year it expects to generate strong cash from operations.
"The completion of this deal is a win for everyone involved," said James W. Griffith, Timken president and chief executive officer. "The Needle Roller Bearings business' new owner is committed to the automotive industry, which provides new opportunity to customers and the talented associates who are transferring with the deal.
"As to Timken, we've fundamentally changed our portfolio of business, in line with our strategy to optimize the enterprise. The resources now in hand can be used to create greater value for our customers and shareholders, including pursuit of new growth in attractive industrial sectors."
Part of Timken's acquisition of Torrington in 2003, the Needle Roller Bearings business manufactures highly engineered needle roller bearings for automotive and industrial applications. Facilities becoming part of JTEKT on January 1, 2010, are in these locations:
- North America: Cairo, GA; Dahlonega, GA; Sylvania, GA; Greenville, SC; Walhalla, SC; and Bedford, Quebec, Canada.
- Europe: Brno and Olomouc, Czech Republic; Maromme, Moult, and Vierzon, France; Kuensebeck, Germany; and Bilbao, Spain.
- Asia: LiYuan District, China.
For the first nine months of 2009, the Needle Roller Bearings business had approximately $289 million in sales and incurred a loss of about $59 million. While the divestiture will reduce Timken's sales for the full year, the net effect on the company's earnings is expected to be positive.