BorgWarner Acquires European Automotive Controls Product Lines From Eaton

AUBURN HILLS, Michigan, October 2 --

BorgWarner Inc. today announced the purchase of the European Transmission and Engine Controls product lines from Eaton Corporation. Terms were not disclosed. With 2006 sales anticipated at US$57 million, the transmission and engine controls operation specializes in high pressure control solenoids for automated transmissions, common rail diesel and gas engines and other applications that complement BorgWarner's expertise in engine and drivetrain electronics.

"Intelligent powertrains are a smart way to drive improvements in fuel economy and emissions worldwide," said Tim Manganello, BorgWarner Chairman and CEO. "Integrating Eaton's European controls products with our existing controls know-how gives us new opportunities for growth in these critical areas. In addition to its product technology, this operation brings us state-of-the-art, highly flexible and efficient low to mid-volume controls manufacturing technology, which can serve as a model for our expansion in developing countries. The acquisition is a strategic step in our global expansion."

The transmission and engine controls operation, located in Monaco, employs about 200 people and has a diverse product and European customer base. It will become part of BorgWarner Transmission Systems and the BorgWarner Drivetrain Group, and will benefit from BorgWarner's existing infrastructure and global reach.

Auburn Hills, Michigan-based BorgWarner Inc. is a product leader in highly engineered components and systems for vehicle powertrain applications worldwide. The FORTUNE 500 company operates manufacturing and technical facilities in 62 locations in 17 countries. Customers include Ford, VW/Audi, DaimlerChrysler, General Motors, Toyota, Renault/Nissan, Hyundai/Kia, Honda, BMW, Caterpillar, Navistar International, and Peugeot. The Internet address for BorgWarner is: http://www.borgwarner.com .