Dana Corporation Announces Agreement to Sell Global Warner Electric Operations
Nov 2, 1999
TOLEDO, Ohio, Nov. 2 /PRNewswire/ -- Dana Corporation (NYSE: DCN) today announced that it has signed an agreement to sell its global Warner Electric Industrial Products Group and most of its Warner Electric Industrial Motors and Controls Group to Colfax Corporation. Completion of the sale, which is subject to the approval of appropriate regulatory agencies, is expected to occur during the fourth quarter of 1999. On completion, this will be the largest divestiture in Dana's history. (Photo: http://www.newscom.com/cgi-bin/prnh/19990903/DANA ) Included in the sale is the Warner Electric Industrial Products Group, which manufactures industrial clutches and brakes, linear actuators, and precision ball screws for a diverse range of applications. Also being sold is part of the Warner Electric Industrial Motors and Controls Group, which produces a wide range of precision electric motors and controls, electronic adjustable speed drives, power conditioning equipment, and voltage and lighting controls. The groups had combined sales of approximately $360 million in 1998 and employ about 3,000 people at 22 major manufacturing and assembly facilities throughout the world. Southwood J. Morcott, Dana chairman, said, "This sale even better positions Dana to grow our core vehicular businesses, focusing on those products that go under the vehicle and under the hood." "This divestiture is important not only because of its size, but also because it enables us to more effectively leverage our vehicular electronic capability. It is also the third transaction this year that demonstrates Dana's resolve to divest non-strategic assets -- one of the elements of our Five-Point Plan," said Joe Magliochetti, Dana president and CEO. The expected sale is consistent with Dana's previously announced Five- Point Plan, which is a tactical link to the company's overall strategic plan. The Five-Point Plan provides elements for continued growth and increased profitability. The plan includes the following five tactics: * Grow while focusing on returns and maintaining financial discipline; * Seek strategic, bolt-on acquisitions at reasonable valuations; * Divest non-strategic and non-performing operations; * Repurchase stock as the company generates cash; and * Complete integration efforts and realize synergy savings. Dana elected to retain the automotive motion control operations in El Paso, Texas, and Chihuahua, Mexico; its American Electronic Components, Inc., facilities serving automotive customers, located in Elkhart, Ind.; and certain automotive engineering and test facilities located in Ann Arbor, Mich. These electronic operations are focused on the vehicular market and not the industrial market. Mike Plumley, president of Dana's Industrial Group, said, "Warner Electric has been an important contributor to Dana, and we owe a debt of gratitude to our people from those divisions. I am confident that Warner will grow further with Colfax, a company with a strong focus on industrial products." Dana has retained the investment-banking firm of J.P. Morgan & Co. Inc. to assist in the transaction. Colfax Corporation is a privately held company based in Richmond, Va. It is a leading manufacturer of fluid handling and industrial positioning products through its Imo Pump, Allweiler, Boston Gear, Ameridrives, and Morse Controls operating companies. Dana Corporation is one of the world's largest independent suppliers to vehicle manufacturers and their related aftermarkets. Founded in 1904 and based in Toledo, Ohio, the company operates some 330 major facilities in 32 countries and employs more than 86,000 people. The company reported sales of $12.5 billion in 1998. Dana's Internet address is http://www.dana.com.
SOURCE Dana Corporation
Web Site: http://www.dana.com
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