GKN Driveline Acquires Velcon in Mexico

AUBURN HILLS, Mich., Feb. 8, 2005 -- GKN Driveline, a leading global automotive supplier, has acquired full ownership of Velcon in Celaya, Mexico -- formerly a joint venture company formed by GKN in 1979 with Grupo DESC, one of Mexico's largest industrial companies. GKN has held a 49 percent share in the joint venture since it was established in 1979.

With forging, machining and assembly operations employing 623 people, Velcon produced more than one million side shaft vehicle sets last year for DaimlerChrysler, Ford, General Motors, Renault-Nissan and Volkswagen, as well as for the automotive aftermarket.

The new GKN Driveline operating unit will be called GKN Driveline Celaya.

"This is an important step in the realization of our sideshaft manufacturing strategy," says Arthur Connelly, chief executive officer, GKN Driveline Driveshafts. "Taking full control of Velcon will build on our successful joint-venture relationship with DESC and enable us to fully integrate Mexico into our global supply chain."

GKN Driveline is one of the world's leading suppliers of vehicle driveline products and systems, commanding a 42 percent share of the market for constant velocity jointed (CVJ) sideshafts. The company is a global enterprise headquartered in the United Kingdom. It recorded total sales of $3.2 billion in 2003. The company currently has 21,000 people working at 49 locations in 31 countries.

Additional information is available at http://www.gkndriveline.com/ .