Dana (DAN) investor relations material

Deal rationale and strategic fit

• Creates a global powertrain leader with a comprehensive portfolio for commercial and light vehicles, expanding scale in core markets and aftermarket segments, and enhancing market reach and customer value.

• Diversifies customer base, balances end-market exposure, and reduces concentration risk while leveraging complementary product portfolios for cross-selling opportunities.

• Accelerates long-term growth strategy, supporting 2030 targets for sales, margins, and free cash flow.

• Positions the combined entity as a leading global powertrain systems provider, supporting both traditional and electrification strategies.

Financial terms and conditions

• Structured as a Reverse Morris Trust, intended to be tax-free for both shareholder groups for U.S. income tax purposes.

• Pro forma ownership: Eaton shareholders just over 50% (at least 50.1%), Dana shareholders just under 50% (about 49.9%).

• Combined enterprise value over $10 billion; Eaton Mobility valued at $5.1 billion, with deal equity component of $4 billion based on a fixed share count.

• $1.1 billion cash dividend to Eaton at close, funded by new debt; pro forma net leverage expected at 1.2x.

• Expected pro forma 2026 sales of $11 billion and $1.7 billion adjusted EBITDA (15% margin); targets $14–$15 billion sales and 18% EBITDA margin by 2030.

Synergies and expected cost savings

• $250 million in annual cost synergies expected within 24 months post-closing.

• Synergies from eliminating duplicative overhead, procurement savings, engineering consolidation, manufacturing optimization, and aftermarket network rationalization.

• Confident in delivering synergies, with potential upside from further operational improvements.