Dana exits Chapter 11 ready to tackle global competition

Jan. 1, 2020
After a comprehensive, 23-month review of its operations, Dana Holding Corporation has emerged from Chapter 11 Reorganization as a stronger global competitor, and is postitioned to compete in the automotive, commercial vehicle and off-highway markets

After a comprehensive, 23-month review of its operations, Dana Holding Corporation has emerged from Chapter 11 reorganization as a stronger global competitor, and is postitioned to compete in the automotive, commercial vehicle and off-highway markets, a spokesperson for the company says. The company also has announced the departure of Mike Burns, who has served as chairman and CEO of Dana since 2004. John Devine, the former vice chairman and chief financial officer of General Motors Corporation, has been elected to serve as Burns' replacement.

Dana's U.S. operations entered Chapter 11 on March 3, 2006. During the reorganization process, the company and its stakeholders achieved $440 million to $475 million in annual cost savings and revenue improvements. These annual savings were achieved primarily from improvements in its manufacturing footprint, reducing labor costs and benefit changes, working with labor and retiree groups to create VEBA trusts to assume ongoing obligations for retiree health and welfare costs and further reductions in administrative expenses.

"Fundamental change has been our objective from the outset of this process," Burns says. "We have achieved this goal through the persistence and dedication of our employees around the world, the partnerships with our labor unions, and the ongoing confidence and support of our customers and suppliers."

Burns will remain with the company for a transition period. Regarding the company's emergence from Chapter 11, he adds: "I am proud of our emergence today and what the people of Dana have accomplished during the restructuring process. Our actions were necessary for the future of the company. And we achieved our goal while maintaining a strong focus on taking care of our customers. This is the right time for a change, and I am convinced that the company and its new leadership are poised for success."

In conjunction with emergence, John Devine has been elected executive chairman and acting CEO of the company. Devine spent five years at General Motors Corporation, before which he served as chairman and chief executive officer of Fluid Ventures, LLC. Previously, he spent 32 years at Ford Motor Company, where he last served as executive vice president and chief financial officer. Devine is also a board member of Amerigon Incorporated.

"I'm pleased to join the Dana team, particularly on this important day for our company and all of its stakeholders," says Devine. "The reorganization achieved by Dana and its people has positioned us to emerge as a more competitive company. We will be focused on the goal of returning Dana to a leadership position in our industry."

Dana obtained $2.0 billion in exit financing through an effort led by Citigroup Global Markets Inc., Lehman Brothers Inc., and Barclays Capital. Despite difficult credit market conditions, the company was able to secure exit financing. The financing consists of a $650 million asset-based revolving credit facility and a $1,350 million term loan facility. Proceeds from the facility will be used by Dana to repay its debtor-in-possession credit facility, make other payments required upon exit from bankruptcy, and provide liquidity to fund new product programs and other investments.

Effective today, common stock in the new company will begin trading on the New York Stock Exchange under the symbol DAN. Shares of Dana Corporation common stock that had most recently traded over the counter under the symbol DCNAQ have been cancelled and will no longer trade.

For more information about Dana Holding Corp., visit the company's Web site.