TOLEDO, Ohio, March 29 /PRNewswire/ -- Dana Corporation (NYSE: DCN) and GKN plc today announced agreements to form a strategic alliance to design advanced driveline systems for all-wheel and four-wheel drive passenger cars, light trucks, and sport utility vehicles, and to jointly develop modular assemblies for passenger car and light-vehicle applications worldwide. "This is a smart alliance of two global leaders in the auto industry that will bring unprecedented benefits to our customers. These agreements mean GKN and Dana will pool resources, skills, and technology," said Joe Magliochetti, chief executive officer of Dana Corporation. "The dynamics of this alliance," said CK Chow, chief executive of GKN plc, "will strengthen the innovative product offering of both companies." Bill Carroll, president of Dana's Automotive Systems Group, said, "This relationship will allow Dana's customers to benefit from the development of next-generation axle and systems technology." Dana and GKN will establish an office in Auburn Hills, Mich., to provide an integrated work environment for engineers from both companies, he said. Sarkis Kalyandjian, executive director and chief executive of the automotive driveline division for GKN, said, "GKN and Dana have worked in partnership for years in successful automotive driveline joint ventures in Mexico and South America. These agreements strengthen an already rock-solid relationship." In addition, Dana and GKN announced an agreement to exchange certain assets that allow each company to focus more strongly on its core competencies. GKN is a global leader in CV joint driveshaft technology, and Dana is an established global leader in the development of cardan-jointed vehicle propeller shafts and axle technology. Under the agreements, Dana will exchange its constant velocity joint business for GKN's global cardan-jointed propeller shaft business. This includes Dana's Columbia, S.C., manufacturing operation; Dana's constant velocity joint venture interests in Argentina and Colombia; and a majority interest in the companies' Brazilian joint venture. GKN will have the option of purchasing Dana's remaining interest in the Brazilian operation as of January 1, 2001. In the exchange, Dana will acquire all of GKN's medium and heavy-duty cardan propeller shaft operations in France, Germany, Italy, and Sweden; as well as a minority interest in GKN's European light-duty cardan-jointed propeller shaft operations, which includes facilities in the United Kingdom and Spain. Dana will have the option to obtain a controlling interest in these operations at a later time. These transactions are subject to the completion of due diligence, negotiation of a definitive agreement, approval of the companies' respective boards, and approval of appropriate regulatory agencies. Dana Corporation is one of the world's largest independent suppliers to vehicle manufacturers and the aftermarket. Founded in 1904 and based in Toledo, Ohio, the company operates some 330 major facilities in 32 countries and employs more than 86,000 people. The company reported sales of $12.5 billion in 1998. Dana's Internet address is www.dana.com. GKN is a global industrial company with sales exceeding 3.7 billion pounds. It designs, develops, and manufactures automotive and agritechnical components, as well as aerospace and defense products and provides a range of industrial services. GKN's operations are located in more than 40 countries around the world, employing some 35,000 people in its subsidiaries, and a further 12,300 in joint ventures. GKN's Internet address is www.gknplc.com.
SOURCE Dana Corporation