ArvinMeritor Inc. said July 22 that the company
would continue to pursue its proposed acquisition of Dana Corp. after that
company's board told its stockholders they should reject the takeover bid.
On July 9, 2003, ArvinMeritor offered $15 per
share for all of Dana's outstanding common stock.
"Despite the fact that the Dana board has
rejected our all-cash tender offer and refuses to negotiate with us, we are
committed to this transaction," ArvinMeritor said in a prepared statement. "Our
offer permits Dana's shareowners to realize an attractive cash value for their
shares today without bearing the risks of Dana's long-term restructuring
"We believe Dana's board and management
team has failed to seize this unique opportunity to maximize value for its
shareowners. As we have indicated previously, if Dana's Board is willing to
work with us to consummate a transaction quickly, we may be prepared to analyze
further whether a higher value is warranted. In addition, because it remains
our strong preference to work together with the Dana Board, we are flexible in
considering a mix of cash and stock consideration if it will facilitate a
"We believe that Dana's response
recites a litany of manufactured reasons to oppose this combination. We are
that there is not one issue listed in today's press release by Dana that cannot
The offer by ArvinMeritor and withdrawal rights
are scheduled to expire at 5 p.m. Aug. 28 unless the company extends them.
In June, ArvinMeritor's CEO Larry Yost offered
Dana Corp. $14 a share, but he said the offer made it no further than the Dana
Board of Directors. In the July 8 letter, Yost informed Dana's CEO he was
prepared to directly offer shareholders $15 per share in cash.
The proposed transaction has a total equity
value of about $2.2 billion. Dana has $2.2 billion in other interests that
bring the total enterprise value to about $4.4 billion.
ArvinMeritor Inc. is a $7-billion global supplier of a broad
range of integrated systems, modules and components to the motor vehicle industry.
The company serves light vehicle, commercial truck, trailer and specialty
original equipment manufacturers and related aftermarkets. Dana Corp. is a
parts maker for cars and trucks, including such products as axels, drive shafts