Dana Holding Corporation said late last week that it had emerged from Chapter 11 reorganisation after a 23-month cost savings drive and securing $US2bn in exit financing.

The US operations of the automotive supplier entered Chapter 11 in March 2006. During the 23-month reorganisation, the company and its stakeholders achieved $440m to $475m in annual cost savings and revenue improvements.

These annual savings were achieved primarily from improvements in its manufacturing footprint, reducing labour costs and benefit changes. The company also worked with labour and retiree groups to create VEBA trusts to assume ongoing obligations for retiree health and welfare costs. There were also further reductions in administrative expenses.

"Fundamental change has been our objective from the outset of this process," said Mike Burns, who has served as Dana's chairman and CEO since 2004. "We have achieved this goal through the persistence and dedication of our employees around the world, the partnerships with our labour unions, and the ongoing confidence and support of our customers and suppliers."

Burns will remain with the company for a transition period.

He added: "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."

The company also said that its board of directors had elected John Devine executive chairman and acting CEO.  Devine is the former vice chairman and chief financial officer of General Motors Corporation, where he served from 2001 to mid-2006. 

"I'm pleased to join the Dana team, particularly on this important day for our company and all of its stakeholders," said Devine. "The reorganisation 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 $2bn in exit financing through an effort led by Citigroup Global Markets, Lehman Brothers, and Barclays Capital, despite the difficult credit market conditions.

The financing consists of a $650m asset-based revolving credit facility and a $1,350m 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.

Common stock in the new company has begun 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.

Who will succeed Mr Burns?