Dana Incorporated Completes Major Sale of Off-Highway Business
Today marks a significant milestone for Dana Incorporated as it successfully completes the sale of its Off-Highway business to Allison Transmission Holdings, Inc. for an impressive $2.7 billion. This strategic transaction has been valued at 7.5 times the anticipated adjusted EBITDA of the Off-Highway segment for 2025, underscoring Dana's commitment to its transformation journey.
Transformative Step for Dana Incorporated
According to R. Bruce McDonald, Chairman and CEO of Dana, this sale represents a crucial turning point in the company's evolution. He stated, "Closing this transaction marks an important step in Dana's evolution. We are now a more focused company, dedicated to serving light- and commercial-vehicle customers with both traditional and electrified systems." The completion of this divestiture will enhance the company's financial health by reducing debt and improving operational focus.
Strengthening Financial Position
The funds generated from this transaction will allow Dana to significantly reduce its debt by approximately $2 billion, helping achieve its target net leverage of 1x. Furthermore, there are plans to return $1 billion to shareholders through 2027, which includes around $650 million already returned since the announcement of this sale—an increase of $50 million from the previous target.
Appreciation for Off-Highway Team
Dana wishes to express sincere gratitude to the dedicated employees of the Off-Highway business. Their hard work and expertise have built a leading organization. Dana is confident that those team members will thrive as part of Allison, contributing to its growth and success.
Advisors and Legal Counsel
In support of this strategic transaction, Dana incorporated the expert insights from Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC as its financial advisors. The reputable legal counsel was provided by Paul, Weiss, Rifkind, Wharton & Garrison LLP, while Ernst & Young LLP played the role of transaction advisor.
Understanding Adjusted EBITDA
In financial terms, adjusted EBITDA serves as a non-GAAP financial metric. This is defined as net income before various expenses such as interest, taxes, depreciation, and others, offering insight into the company's operational performance. Dana uses adjusted EBITDA to assess its business strategies and make informed financial decisions. This metric is not a substitute for GAAP results but provides significant value in evaluating financial health relative to other Tier 1 automotive suppliers.
About Dana Incorporated
Dana is a prominent leader in creating efficient propulsion and energy management solutions for the global mobility market. By delivering advanced and traditional energy solutions, Dana supports nearly every vehicle manufacturer. With profound expertise, the company shapes sustainable progress with technologies that span multiple sectors.
Headquartered in Maumee, Ohio, Dana reported impressive sales nearing $7.7 billion for the year 2024, employing around 28,000 individuals across 22 nations. Its rich history, dating back to 1904, includes honors such as being named among the "World's Most Ethical Companies" for 2025 by Ethisphere and recognized by 'Newsweek' as one of "America's Most Responsible Companies 2025." Dana’s high-performance culture emphasizes values, innovation, responsible growth, and collaborative success, positioning it as a top global employer.
Frequently Asked Questions
What was the significance of the Off-Highway business sale?
The sale marks a pivotal moment for Dana, enabling a more focused approach on light- and commercial-vehicle markets while strengthening financial health.
How will Dana use the proceeds from the sale?
Approximately $2 billion will be used to reduce debt, while $1 billion is earmarked for shareholder returns through 2027.
Who provided advisory support for the transaction?
Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC were the financial advisors, while legal counsel was given by Paul, Weiss, Rifkind, Wharton & Garrison LLP.
What does adjusted EBITDA represent?
Adjusted EBITDA serves as a non-GAAP measure to evaluate operational performance and is used by Dana to assess profitability and make financial decisions.
What is Dana Incorporated known for?
Dana is renowned for its innovative propulsion and energy-management solutions that cater to a vast array of vehicle manufacturers, fostering sustainable technologies.
