Dana Corporation Announces Strategic Purchase of Engine Bearings Business

Oct 27, 1998

    TOLEDO, Ohio, Oct. 27 /PRNewswire/ -- Dana Corporation (NYSE: DCN)
announced today that it has signed a definitive agreement with Federal-Mogul
Corporation (NYSE: FMO) to purchase the Glacier Vandervell Bearings business
for $410 million and the AE Clevite North American non-bearing aftermarket
engine hard parts business for $20 million, making the total transaction price
$430 million.  The businesses were part of the T&N plc. organization.
    Sales for the businesses will approximate $450 million in 1998, with the
non-bearing aftermarket engine hard parts business accounting for
approximately $55 million of that total. 1999 sales for the businesses are
expected to be $480 million.  The transaction is subject to the approval of
appropriate regulatory agencies.
    "This transaction is immediately accretive and represents excellent value
for Dana shareholders.  The transaction is valued at approximately 6.6 times
1998 EBITDA, without any synergies.  Furthermore, the acquisition will make
Dana a leading supplier to the global thin-wall bearings market, adding
another key component to our already strong line up," said Dana Chairman and
CEO Southwood J. Morcott.  "We continue to pursue opportunities to provide an
even more comprehensive portfolio of internal engine components and systems to
customers around the world."
    The Glacier Vandervell assets to be acquired include thin-wall and half-
shell bearings; thrust washers; wear plates; and other components sold under
the Glacier(TM), Vandervell(TM), Clevite(TM), and Clevite 77(TM) brand labels,
among others.  These products are primarily used in passenger car and light-
duty vehicle applications for both original equipment manufacturers and the
    Glacier Vandervell facilities to be acquired by Dana include six European
operations, in Annecy and Dieuze, France; Heilbronn, Germany; Trento, Italy;
and Kilmarnock and Whitehill, Scotland; as well as four North American
operations in Bellefontaine, Ohio; Caldwell, Ohio; a fabrication plant in
McConnelsville, Ohio; and Atlantic, Iowa.  This also includes packaging and
distribution facilities located in Collierville, Tenn., and Olive Branch,
Miss., as well as a sales and marketing operation in Ann Arbor, Mich.
    Chuck Heine, president of Dana's Engine Systems Group, said the products
to be acquired will support the company's global growth goals.  "Glacier
Vandervell has a strong sales base in Europe as well as North America," he
said, "and Glacier Vandervell is the only producer of thin-wall bearings
supplying all six major U.S.-based OEMs."
    The non-bearing AE Clevite engine hard parts aftermarket business includes
products such as camshafts, valves, and other valvetrain, timing, and cylinder
components sold primarily to the growing market of production engine re-
builders and engine specialists.
    Larry McCurdy, president of Dana's Automotive Aftermarket Group added,
"When we combine AE Clevite's hard parts with Dana's Perfect Circle(R) engine
products and Victor Reinz(R) gaskets, Dana will be able to offer its
aftermarket customers a more complete engine systems package."
    One of the world's largest independent suppliers to vehicular, off-
highway, and industrial manufacturers and their related aftermarkets, Dana
Corporation produces components and systems used on more than 95 percent of
the world's 670 million motor vehicles.  Founded in 1904 and based in Toledo,
Ohio, the company operates 270 major facilities in 33 countries and employs
more than 79,000 people.  The company had pro forma sales of $11.9 billion in
1997.  Dana's Internet address is http://www.dana.com.
    Certain statements contained herein constitute "forward-looking"
statements within the meaning of the Private Securities Litigation Reform Act
of 1995.  Such forward-looking statements involve assumptions, known and
unknown risks, uncertainties, and other factors, which may cause Dana's actual
future results, performance, or achievements to differ materially from the
results, performance, or achievements expressed or implied by such forward-
looking statements.  Such factors include, among other things, the following:
achieving sales levels to fulfill revenue expectations; the absence of
presently unexpected costs or charges, certain of which may be outside the
control of Dana; the cyclical nature of the automotive industry; achievement
of the anticipated synergies or savings; general economic and business
conditions, including international economic circumstances; and competition.
Additional factors are detailed in Dana's public filings with the Securities
and Exchange Commission.  Dana disclaims any responsibility to update any
forward-looking statement provided in this press release.

SOURCE Dana Corporation

Web Site: http://www.dana.com

Company News On Call: Company News On-Call:
http://www.prnewswire.com/comp/226839.html or fax, 800-758-5804,
ext. 226839