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Allison Transmission Holdings Inc.

Allison Transmission Acquires Dana's Off-Highway Business in $2.7 Billion Deal

Strategic Insights

— 1 min read

Allison Transmission, a leading auto components manufacturer, has announced the acquisition of Dana's Off-Highway business in a strategic move to expand its emerging markets footprint, enhance core technologies, and drive strong financial results. The transaction, valued at approximately $2.7 billion, is expected to be immediately accretive to Allison's diluted earnings per share and generate annual run-rate synergies of approximately $120 million. The acquisition is set to widen Allison's range of commercial-duty powertrain and industrial solutions, enabling the company to offer a broader portfolio of products to customers and end-users worldwide.

Key Takeaways:

  • Allison Transmission has acquired Dana's Off-Highway business in a deal worth $2.7 billion, marking a significant expansion of its emerging markets footprint and core technologies.
  • The acquisition is expected to be immediately accretive to Allison's diluted earnings per share and generate annual run-rate synergies of approximately $120 million.
  • Upon completion, Allison will offer a wider range of commercial-duty powertrain and industrial solutions to more customers and end-users worldwide.
  • The company intends to utilize its expanded global presence and technical expertise to realize new growth opportunities and develop differentiated solutions.
  • The acquisition was approved by both companies' boards of directors, and is expected to close late in the fourth quarter of 2025, pending customary regulatory approvals.
  • Allison will deploy a transition and integration process across the business to ensure a smooth integration of the acquired assets.
  • The company will finance the transaction using a combination of cash on its balance sheet and debt.
  • BofA Securities and KPMG LLP are serving as Allison's financial and transaction advisors, respectively, while Latham & Watkins LLP is serving as legal advisor.
  • Barclays, BofA Securities, and Citigroup provided committed financing in connection with the transaction.
  • Goldman Sachs & Co. LLC and Morgan Stanley & Co. LLC are serving as Dana's financial advisors, while Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as Dana's legal counsel.
  • EY Corporate Finance is serving as Dana's transaction advisor.

Statistics:

  • $2.7 billion: value of the acquisition
  • $120 million: annual run-rate synergies expected from the transaction
  • 2025: expected closing date of the transaction, pending customary regulatory approvals
  • 50%: proportion of the transaction to be financed using cash on Allison's balance sheet, while the remaining 50% will be financed using debt
  • 4 quarters: time period in which the transaction is expected to be completed

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