Dana To Dissolve Mexico Joint Venture
Posted on November 23, 2005
Dana Corp. said it will dissolve a joint venture with Mexico's DESC SA de CV and take full ownership of five factories. In dissolving Spicer SA de CV, Dana will take over axle and driveshaft factories, as well as forging and foundry operations in which it has an indirect 49% stake. DESC will take over transmission and aftermarket gasket operations in which it has a 51% stake. Dana CEO Mike Burns said in a statement that the transactions will help Dana become more efficient, and strengthen its "core" axle and driveshaft businesses.
Dana said last month it will sell its engine hard parts, fluid products and pump products units, and focus on light and heavy vehicle drivetrain products, structures, sealing and thermal products. Under this most recent transaction, Dana will take over five manufacturing facilities in Mexico with annual sales of $290 million. DESC will take over three operations in Mexico and one, Transmission Technologies Corp., that operates in Knoxville, Tennessee. The transactions are expected to be completed in the first quarter of 2006, pending the signing of a definitive agreement, approval by Dana's board of directors and regulatory approvals.