Dana increases cash consideration for GKN Driveline by £100m

New twist in the takeover tale

In support of strong investor interest in its combination with GKN Driveline, Dana Incorporated announced today that it has improved the terms of its agreed combination and will also double the size of its share repurchase program.

Dana has increased the cash element of consideration by $140m (£100m), representing an 8.6 per cent increase in the cash consideration and delivering further value to GKN shareholders.

Dana will double the size of its share repurchase program to $200m (£145m). The company expects to use its share repurchase program to support liquidity in all markets for Dana shares following the merger. 

As a result, the total cash consideration is approximately $1.77bn (£1.28bn), along with the assumption of approximately $1bn of IAS 19 net pension liabilities, and approximately 133 million new Dana plc shares issued to GKN’s shareholders.  As agreed previously, upon completion of the transaction, Dana plc will be registered in the U.K., and the shares will be listed on both the London Stock Exchange and the New York Stock Exchange, allowing GKN shareholders to benefit from the significant value creation a Dana-GKN Driveline combination will provide.

Jonathan Collins, executive vice president and chief financial officer of Dana, said:  “Today’s announcement demonstrates our support for investors following a series of productive meetings where the many benefits of the combination have become ever more apparent.  We are clearly enhancing the superior value this combination offers to GKN shareholders.  This strategic transaction is driven by powerful industrial logic and offers a unique opportunity for shareholders to participate in the creation of a global leader in vehicle drive systems and electric propulsion.

“The increase in our share repurchase program illustrates further confidence in our ability to unlock the value of this combination, including $235m of synergies available only as a result of this transaction, as well as the delivery of a successful integration that has the support of investors, employees, pension trustees, and a global customer base.”