Dana Merges with UK Automotive Supplier
Dana Incorporated has announced it has signed an agreement to merge with the Driveline division of global automotive system supplier GKN plc to create Dana plc, a global provider of driveline systems.
GKN Driveline is based in the United Kingdom and produces constant constant-velocity jointed driveshafts, all-wheel-drive systems, and electrified driveline solutions. The transaction also includes GKN’s Off-Highway Powertrain Services business, which serves the off-highway power delivery and service market.
GKN Driveline has around 35,000 employees globally with operations in 23 countries and has 61 manufacturing locations, including one of the largest driveline businesses in China via its joint venture, Shanghai GKN Huayu Driveline Systems (known as SDS).
With sales of around $13.4 billion, the new company will become a global leader in vehicle drive systems across light vehicle, commercial, and off-highway markets.
Dana plc will also be well positioned for the vehicle electrification market with its core eDrive technology portfolio, according to the company. The deal also solidifies Dana’s presence in key markets, such as China.
“This transformative and strategic transaction solidifies Dana as a world leader in vehicle drive systems and establishes a leading position in electric propulsion, which we see as the future of vehicle drivetrains,” said James Kamsickas, president and CEO of Dana.
The deal includes $1.6 billion in cash proceeds to GKN plc, the assumption of approximately $1 billion of net pension liabilities, and 133 million new Dana plc shares issued to GKN’s shareholders, valued at approximately $3.5 billion (based on Dana’s share price as of March 8, 2018).
Under terms of the agreements, Dana shareholders will own approximately 52.75% of the company with GKN shareholders owning 47.25%. The combined company will be based in the United Kingdom as Dana plc and will continue to trade on the New York Stock Exchange under the ticker symbol DAN.
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