Dana has obtained all required regulatory approvals to complete the sale of its Off‑Highway business to Allison Transmission Holdings, Inc. The transaction, valued at $2.7 billion, is expected to close by the end of 2025, giving Dana a clear path to finalize the divestiture and focus on its core on‑highway markets.
The deal will allow Dana to return $600 million to shareholders this year and reduce its debt by roughly $2 billion next year, as outlined in its capital‑return program. The program, which authorizes $1 billion in returns through 2027, already includes a $189 million share‑repurchase in the third quarter and a $73 million cost‑saving realization, bringing year‑to‑date savings to $183 million under a $310 million initiative.
Strategically, the sale removes a legacy segment that has been a drag on margins and diverts management attention from the high‑growth on‑highway light‑vehicle and commercial‑vehicle businesses. Allison, a leading off‑highway transmission supplier, gains a market‑leading drive and motion system portfolio, positioning it for accelerated growth in the global off‑highway market.
Dana’s recent financials underscore the rationale for the transaction. Full‑year 2024 sales fell to $10.3 billion from $10.6 billion in 2023, while Q4 2024 revenue was $2.3 billion versus $2.5 billion a year earlier. In Q3 2025, sales were $1.92 billion, and adjusted EBITDA rose to $162 million, a margin of 8.5%—up from 5.9% a year earlier—thanks to disciplined cost control and operational efficiencies. Management projects a 10‑10.5% adjusted EBITDA margin in 2026, a target that the cost‑saving program and the divestiture are designed to support.
CEO R. Bruce McDonald emphasized that the transaction “strengthens our balance sheet, reduces complexity, and allows us to return significant capital to shareholders.” He added that the $310 million savings initiative is on track, with over $70 million realized in Q3, and that the company expects the Off‑Highway divestiture to complete in the fourth quarter. McDonald also noted that the company’s focus on electrified systems and high‑margin on‑highway segments will drive the next‑phase of growth.
For Allison, the acquisition expands its product portfolio and enhances its technological capabilities, making it an immediate EPS accretor. The deal is expected to generate synergies that will reinforce Allison’s position in the off‑highway market and provide a platform for future growth.
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