Dana sues ArvinMeritor's financial advisor
Aug 6, 2003 12:00 PM, from staff and wire reportsDana Corp escalated its fight against rival ArvinMeritor IncÕs $4.4 billion hostile takeover bid, suing its rivalÕs financial adviser UBS AG for misappropriating confidential information.
The suit against the Swiss bank, which had once advised Dana, was the latest shot by the company that on July 8 rejected ArvinMeritorÕs offer as too low.
ArvinMeritor already has sued Dana for misleading investors when it justified its rejection of the all-cash bid from its smaller rival.
DanaÕs federal lawsuit, filed in the Southern District of New York, said UBS, while working on a project for Dana in March 2002, had gathered Òconfidential information about Dana, its financial condition, its business plan and prospects, its competitive posture, trade secrets, and its potential liabilities.Ó
Dana did not say what the project was, but a source familiar with the situation said it involved a joint venture which got stalled as Dana and the other unnamed party could not agree on working conditions with workers.
Responding to the lawsuit, a UBS spokesman said its relationship with ArvinMeritor predates its links with Dana.
ÒDana acknowledged the potential for UBS to do business with competitors and its procedures for protecting confidentiality. We believe the lawsuit is without merit and intend to defend against it vigorously," he said.
In its lawsuit, Dana said it was seeking to end the advisory relationship between UBS and ArvinMeritor.
ArvinMeritor announced July 8 it was offering $15 in cash for each share in rival Dana, which rejected the deal, saying it undervalued the company and was Òrisky.Ó The dealÕs total value is $4.4 billion, including $2.2 billion for the offer to buy Dana stock, plus assumption of $2.2 billion in debt from Dana.
In other news, Dana says it will close eight more factories or offices this year as it completes a 2001 cost-cutting plan. Dana already has closed 31 plants and eliminated about 15,000 jobsÑor 20% of its workforceÑunder the October 2001 plan. The company disclosed the figures in a filing with the United States Securities and Exchange Commission.
Dana didnÕt say which operations would be closed during the rest of this year. The company said it also divested $710 million in assets under the plan, with net gains of $49.5 million.