Cummins CEO James A. Henderson succeeds Henry B. Schacht as board chairman; 'Tim' Solso succeeds Henderson as president; Schacht will retire but serve as chairman of the executive committee.

COLUMBUS, Ind.--(BUSINESS WIRE)--Feb. 14, 1995--The board of directors of Cummins Engine Co., Inc. (NYSE:CUM), the world's leading manufacturer of diesel engines, today announced a number of major managerial and board changes in line with a management succession plan which was set in motion last July.

James A. (Jim) Henderson, who was named chief executive officer on July 12, 1994, was elected board chairman succeeding, Henry B. Schacht. Mr. Schacht, who will retire, served as Cummins' chief executive officer for 21 years. Theodore M. (Tim) Solso, also a board member, becomes president of the company, succeeding Mr. Henderson, who will relinquish that title.

Mr. Schacht was named chairman of the board's executive committee, a position previously held by J. Irwin Miller, who continues as a member of the board. Mr. Miller, chairman of Cummins from 1951 to 1977, has been associated with the company for over six decades.

Citing the new alignment, Mr. Henderson said he was delighted with the board's naming of Mr. Solso to the position of president, noting that "Tim and I have worked together for nearly 25 years. His appointment underscores our absolute confidence in Tim's ability to manage Cummins' global growth and reflects our deeply-rooted commitment to management continuity. I intend to work with Tim in the same way I worked with Henry Schacht. I will work on the growth strategy, technical direction and relationship side of the business, while Tim concentrates on ensuring our operations run as smoothly as our engines."

Commenting on his appointment, Mr. Solso said, "From a product, technology and financial standpoint, Cummins has never been stronger. We have made great strides in diversifying our business both from a product and a geographic standpoint. With our business and that of our customers moving in an increasingly global direction, there are many opportunities for future growth. I look forward to helping Jim position Cummins to take full advantage of these opportunities."

Mr. Henderson added, "I am very pleased that Cummins and I will continue to benefit from Henry Schacht's guidance and counsel on strategic relationships around the world. In the more than thirty years Henry and I have worked shoulder-to-shoulder here at Cummins, we have built a working relationship as friends and colleagues that I believe is rare in American business. His willingness to remain on the board and chair the executive committee is a real plus for Cummins."

Speaking on behalf of Cummins' outside directors, Franklin A. Thomas said, "The management transition set in motion last July has been seamless. It reflects the kind of planning and execution that is commonplace throughout the Cummins organization."

"Jim Henderson and Tim Solso have won the full and unanimous confidence of the Cummins board of directors," said J. Irwin Miller, board member and former Cummins' chairman (1951-1977). "The management team and the board retain the strong and able counsel of Henry Schacht, and I am personally pleased that he has agreed to assume my responsibilities as chairman of the board's executive committee."

Under Mr. Henderson's leadership as chief executive officer, Cummins has continued to extend its product lines as well as its market share among existing products. Important steps in this strategy have included the acquisition of Power Group International (PGI), based in Kent, England. PGI adds to Cummins' product line with a broad range of power generation equipment sold under the well-known trade names Petbow, Auto Diesel and Agreba. Additionally, the company recently announced a 50/50 joint venture with Wartsila Diesel International of France to produce medium-speed diesel engines for use in power generation, industrial and auxiliary applications and marine propulsion.

Cummins Engine Company, Inc., which celebrated its 75th anniversary last year, is the leading worldwide designer and manufacturer of fuel-efficient diesel engines and related products. Cummins has manufacturing facilities, joint ventures or license agreements in the United States, the United Kingdom, India, Mexico, Brazil, Zimbabwe, Indonesia, South Korea, China, Japan, Pakistan, Turkey, Russia, Australia, France, Sweden, Spain and Germany.

James Alan Henderson, Chairman and Chief Executive Officer

James Alan Henderson, 60, joined Cummins in 1964 and was elected president and chief operating officer in 1977. He is a member of the board of directors of Cummins, Ameritech Corp., Inland Steel Industries, Landmark Communications, Inc., and Rohm & Haas.

Mr. Henderson is president of the board of trustees of The Culver Educational Foundation, and was chairman of the executive committee of the Princeton University board of trustees from 1986 to 1992.

Born in Culver, Ind., he graduated cum laude from Culver Military Academy in 1952. At Princeton University, he received his A.B. degree in 1956 in public and international affairs.

After serving in the U.S. Navy from 1956 to 1961 as a lieutenant with three years on a destroyer and two years teaching at the U.S. Naval Academy, he received his M.B.A. from Harvard University in 1963, graduating with high distinction. He then became a member of the Harvard Graduate School of Business faculty for one year and co-authored a textbook on collective bargaining.

Theodore Mathew (Tim) Solso, President and Chief Operating Officer

Mr. Solso, 47, joined Cummins in 1971, and has served as executive vice president of operations since 1992. He was named chief operating officer last July, and has responsibility for all operating divisions worldwide, which had sales in 1994 of $4.7 billion.

In his career at Cummins, he has served as director of personnel for Cummins' Brazilian operations; director of management development; executive director of personnel; vice president and general manager of Cummins' Holset turbocharger subsidiary in England; vice president of marketing, and vice president and general manager of the engine business.

Mr. Solso is a member of the board of Irwin Financial Corp., Cummins Engine Foundation and Cyprus Amax Minerals Co.; a member of the board of trustees of DePauw University; and a member on the dean's advisory boards for the schools of business at Hofstra University and Indiana University. In Columbus, he is a member of the board of directors of the Heritage Fund of Bartholomew County and the Otter Creek Golf Course.

Mr. Solso received his B.A. from DePauw University in 1969 and his M.B.A. from Harvard Graduate School of Business in 1971.

Henry Brewer Schacht, Chairman of the Executive Committee of the Board of Directors

Henry Brewer Schacht, 60, joined Cummins in 1964 after two years with American Brake Shoe Co., four years in the U.S. Navy, two years at Harvard Graduate School of Business and two years with Irwin Management Co.

At Cummins, he has served as vice president of finance, vice president and central area manager (international), group vice president of international and subsidiaries, president and chief executive officer -- a title he relinquished in favor of Mr. Henderson in July, 1994. He was elected president and to the Cummins board of directors in 1969, chief executive officer in 1973, and chairman and chief executive officer in 1977. He currently serves as chairman of the executive committee.

Mr. Schacht is a director of AT&T, CBS, Chase Manhattan Corp., The Chase Manhattan Bank and Alcoa.

He is chairman of trustees of The Ford Foundation, and a trustee of The Yale Corp., the Committee for Economic Development and The Business Enterprise Trust, and is an honorary trustee of The Brookings Institution.

Mr. Schacht is an active member of numerous educational and economic advisory councils, including the Council on Foreign Relations and the Associates of Harvard Business School. He has previously served as a trustee with organizations including the Rockefeller Foundation, the Urban Institute and the National Executive Service Corps., among others.

He received his B.S. degree from Yale University in 1956; an M.B.A. from Harvard Business School in 1962; an Honorary D.Sc. degree from DePauw University in 1982, and an Honorary M.A. from Yale University in 1988.

CONTACT: Cummins Engine Co., Columbus

Ann C. Smith, 812/377-3524