The death of Dana Corporation CEO Joe Magliochetti is likely to stiffen the company’s resistance to ArvinMeritor’s takeover bid, Automotive News reported. The motor industry newspaper also said Dana’s board is likely to select a replacement from the tightly knit ranks of Dana’s senior executives who worked closely with Magliochetti during his three-month battle against ArvinMeritor.
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According to Automotive News, citing analysts and a company insider, the leading candidate for the top job is William Carroll, 59, who joined the Toledo, Ohio, driveline supplier 34 years ago and was named acting president after Magliochetti’s death last week.
Automotive News said Carroll emerged as a vociferous opponent after ArvinMeritor issued its bid and noted that another hard-liner is Glen Hiner, a 69-year-old Dana director who led a committee of outside directors that recommended against accepting ArvinMeritor’s offer.
Automotive News said that, in a written statement reporting Magliochetti’s death last week, Hiner said Dana’s management “continues to have the full support of the board of directors as it pursues the strategic course that Joe forged.”
Automotive News noted that Dana has been criticised by ArvinMeritor and others for its insular, promote-from-within strategy but said the parts maker has preserved a closely knit, seasoned team of senior executives, each with more than 30 years of experience and each capable of operating the firm.
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By GlobalData
Noting that, though Magliochetti’s death appears to have caused a lull in the fight with ArvinMeritor – the rival firm has publicly offered condolences to Magliochetti’s family and Dana’s employees – Automotive News said the $2.2 billion offer for Dana remains open.
The paper also noted that whoever secures Magliochetti’s job will have to complete his three-year-old turnaround plan – Dana has shed 19,000 of its 79,000 employees, closed dozens of factories and slashed the dividend and, last year, posted net income of just $58 million on sales of $9.6 billion after losing nearly $300 million a year earlier.
Magliochetti’s successor also must begin Dana’s rapprochement with the UAW, a reversal of the company’s long anti-union position, Automotive News said, adding that the new CEO also must decide whether to buy Chrysler group’s Detroit Axle plant.
