Commercial Vehicle Group has reached an agreement to sell its Cab Structures business with operations in Kings Mountain, N.C., to a Volvo Group company, effective July 31, 2024.
CVG says the net proceeds of the transaction are expected to be $40 million, with closure expected in the second half of 2024. The Company expects the majority of proceeds to be used for debt paydown and other general corporate purposes.
The Cab Structures business primarily serves the Class 8 truck market. CVG says this transaction continues a trend of heavy truck OEMs insourcing their cab structure production in recent years.
“The strategic sale of our Cab Structures business marks another milestone on our journey to evolve our business towards higher-growth products and markets, in line with our ongoing strategic transformation plan, while simultaneously generating shareholder value. The sale of our Cab Structures business reduces our exposure to the cyclical Class 8 market, lowers our customer concentration, removes complexity from our business, and improves our return profile,” says James Ray, CVG president and CEO.
About 230 CVG employees are expected to become employees of Volvo, as part of the transaction.
“We are very happy to see this plant in good hands,” adds Ray. “Volvo brings proven operating experience. Kings Mountain employees will benefit from continuity of the plant’s operations and will have the unique opportunity to work for the OEM.”