If I may borrow, and slightly adapt, a phrase from my usual US nightly newscast (obligingly screened live here in Olde England at 11.30pm): “breaking news as we go on air, today – Dana and GKN Driveline have agreed to merge“.
Dana announced Friday (9 March) it had signed definitive agreements to combine with the driveline division of GKN plc to create Dana plc, ‘a global leader in driveline systems’. GKN’s board has recommended the merger (which many stakeholders will see as more palatable than a takeover by industrial investor Melrose) for a total consideration of $1.6bn in cash proceeds to GKN plc, the assumption of approximately $1bn of net pension liabilities, and 133m new Dana plc shares issued to GKN’s shareholders, valued at approximately $3.5bn (based on Dana’s share price as of March 8, 2018).
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This comes just a couple of days after Unite union members from Jaguar Land Rover and other UK based carmakers were set to join GKN Driveline workers in a show of solidarity and to unfurl a banner calling on Theresa May’s government to block what the union, in a statement, termed “Melrose’s debt-fuelled takeover bid of the British-based engineering firm”.
We’ve been covering this for a while and the news of the merger of a driveline specialist (its innovative e-axle is underneath a number of recently launched electrified vehicle models) with a long-standing chassis and driveline supplier, already well known to UK automakers such as JLR, makes sense. As we reported last week, GKN Driveline was “very, very confident” its customers would continue to give it full backing while its parent group battled a bid from the manufacturing investor Melrose. It said it had received “a number of approaches” and confirmed it had started discussions with Dana to potentially combine its driveline business with the US component manufacturer mainly through equity. To bolster its case to remain independent, GKN had forecasting sales growth from GBP33m (US$46m) to GBP500m by 2022 while its board had ‘unanimously’ been rejecting the Melrose attempt, slamming it as “entirely opportunistic.”
Before that dramatic climax to Our Week, Geneva, naturally, had been the main focus. A new member of our just-auto team, Mike Vousden, reported from the floor on the emphasis this year on electrification and autonomy, and interviewed Cupra strategy director Antonino Labate, the man behind the new, 300hp Ateca Cupra SUV.
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Meanwhile, Chris Wright caught up with an old just-auto friend, and fellow Brit, Kia Motors Europe COO Mike Cole, who was cautiously optimistic the automaker, about to launch its third iteration of the popular C-segment Ceed, can break through the 500,000 sales barrier this year with numbers already running 6% ahead of last year which ended with 472,000 sales. Chris also joined an entertaining (as usual) round table with FCA supremo Sergio Marchionne, spoke with Ssangyong’s and cast an eye over Dutch company PAL-V’s Liberty flying car and talked electric off-roading with Ssangyong UK’s new chief Nick Laird.
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By GlobalDataAs always, our full show coverage can be found in one spot here.
Other stories that caught readers’ eyes this week include Nissan US’ Smokin’ Titan, a China based Continental/CITC JV for 48V mild hybrid systems and Geely’s taking a slice of Daimler.
Have a nice weekend.
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