Dana Corp

Diesel Progress North American Edition, Jan, 2008

A U.S. federal judge has cleared the way for Dana Corp. to borrow up to $2 billion to finance its exit from bankruptcy by the end of January. A deal with Citigroup Global Markets Inc., Lehman Brothers and Barclays Capital has been worked out, with the financing offer expiring on Feb. 29. However, Dana said it plans to emerge from bankruptcy by the end of January. The Toledo, Ohio-based components manufacturer has been in Chapter 11 proceedings since March 2006. The reorganization plan calls for unsecured creditors to be repaid 72 to 86% of the $3 billion owed.

Reportedly, the deal consists of a $650 million revolving credit facility and a $1.3 billion loan. In addition to the $2 billion loan, Dana will finance its reorganization with $790 million in new equity, with the private equity firm Centerbridge Capital Partners acting as lead investor.