ArvinMeritor Inc. (ARM) has completed a $180 million sale of its wheel-manufacturing units to Brazilian railroad-equipment manufacturer Iochpe-Maxion SA (MYPK3.BR), saying it would use the proceeds to pay down its revolving credit facility.

The auto-parts supplier initially announced the sale last month, when the company reported it swung to a fiscal third-quarter loss amid weak auto-production volume. However, core results topped expectations at the time.

ArvinMeritor has been working to remain in compliance with its year-end credit line financial covenant. Last month, it reduced usage of the revolver by $145 million. And on Monday, ArvinMeritor said it would use the net proceeds of $169 million from the sale to reduce outstanding balances on the revolver.

ArvinMeritor maintained it expects to remain in compliance with its financial covenant in the fourth quarter.

The wheels business operates manufacturing facilities in Limeira, Brazil, and San Luis Potosi, Mexico.

Shares were up 1.2% to $8.21 in after-hours trading. The stock has surged in recent months from its all-time low of 32 cents in March.

-By John Kell, Dow Jones Newswires; 212-416-2480; john.kell@dowjones.com