Dana Corporation is to sell its automotive aftermarket business to The Cypress Group, a New York based private equity group which manages two private equity funds with more than $3.5 billion in commitments, for approximately $1.1 billion in cash.
Dana Chairman and CEO Michael Burns said proceeds from the sale will be used for a combination of reinvestment in the company’s core businesses, and a contribution to the company’s pension plans and further reduction of Dana’s debt.
The sale includes 52 facilities employing approximately 13,000 people world-wide. Combined annual sales for these operations were approximately $2 billion in 2003.
The transaction also involves several premier replacement product brands and a variety of under-vehicle components.
It does not, however, include Dana’s distribution and marketing operations for its engine products, such as piston rings, gaskets, and engine bearings, which Dana will retain as part of its Automotive Systems Group.
The transaction, which is expected to close in the third quarter this year, is subject to the purchaser’s receipt of financing from committed sources and other customary conditions, including the receipt of regulatory approvals.