Cummins Inc. (NYSE: CMI) and Rush Enterprises Inc. (NASDAQ: RUSHA & RUSHB) on July 29 announced that they have signed a Letter of Intent for Cummins to acquire a 50% equity interest in North Texas-based Momentum Fuel Technologies from Rush Enterprises.
The joint venture between Rush Enterprises and Cummins will produce Cummins-branded natural gas fuel delivery systems for the commercial vehicle market in North America, combining Momentum Fuel Technologies’ compressed natural gas (CNG) fuel delivery systems, Cummins’ powertrain expertise, and the engineering and support infrastructure of both companies.
The proposed transaction is expected to close later this year, subject to completion of customary pre-closing activities and entering into mutually agreeable transaction documentation.
“This collaboration shows Cummins’ continued commitment to natural gas powertrains,” said Srikanth Padmanabhan, President of the Engine Business at Cummins. “This partnership will improve customers service for both CNG and RNG through an improved support network. We are thrilled to expand our network of clean and reliable power solutions.”
“The immediate environmental benefits of CNG and RNG, combined with upcoming regulatory requirements, will drive growth in natural gas vehicles for the foreseeable future,” said W.M. “Rusty” Rush, Chairman, Chief Executive Officer and President, Rush Enterprises, Inc. “This partnership will enable Rush Enterprises to continue to provide unparalleled support to our customers through our mutual, wide-ranging portfolio of Cummins’ and RushCare aftermarket solutions and keep trucks up and running across the country.”
The joint venture will offer aftermarket support through Rush Truck Centers dealerships and Cummins distributors which will be able to service both the engine and the fuel delivery system. The partnership between Cummins and Rush Enterprises will benefit customers by providing them with access to an extensive CNG vehicle parts and service network; both Cummins’ and Rush Enterprises’ respective networks, which together represent over 250 locations in the US and Canada, will be equipped with certified technicians and access to a comprehensive CNG vehicle parts inventory.
Momentum Fuel Technologies, headquartered in Roanoke, is the industry’s first complete compressed natural gas (CNG) fuel system solution for Class 6-8 vehicles. A division of Rush Enterprises, the company officially launched in 2015 and is a vertically integrated provider of fuel system solutions, featuring state-of-the-art engineering, design and manufacturing processes, complete system installation capabilities and the industry’s most comprehensive sales, service and support network.