Slaughter and May is advising GKN plc on the proposed combination of its automotive business and Dana Inc, a NYSE-listed global leader in vehicle drive systems.

The combination is being undertaken as part of GKN’s defence against a share and cash unsolicited offer by Melrose Industries plc announced on 1 February 2018, which has been rejected by the Board of GKN.

On both the proposed Dana Inc combination and Melrose offer, Slaughter and May is working closely with a Cravath, Swaine & Moore LLP team led by Richard Hall, George Schoen and Jenny Hochenberg.

The proposed Dana Inc combination values GKN Automotive at a total enterprise value of approximately £4.5 billion (US$6.2 billion). As part of the transaction, an IAS 19 pension liability at 31 December 2017 of £780 million will be transferred to Dana plc, net of deferred tax asset transferred to Damson plc of £132 million.

The proposed combination will be effected through the demerger of GKN Automotive to a new UK plc (“Dana plc”) and the merger of Dana Inc under Delaware law with a subsidiary of Dana plc. GKN shareholders will own 47.25% of the fully diluted share capital of Dana plc and GKN will receive cash proceeds of approximately $1.7 billion.

The combination is conditional on, amongst other considerations, approval by GKN and Dana shareholders and the lapsing of the Melrose offer.
Contacts

On the Dana Inc combination: Corporate: Martin Hattrell (partner), Rob Innes (partner); Pensions: Charles Cameron (partner); Tax: Dominic Robertson (partner); IP: Cathy Connolly (partner); Real Estate: John Nevin (partner); Employment and Share Schemes: Padraig Cronin (partner); Competition: Phillippe Chappatte (partner) and Lisa Wright (partner)

On the Melrose offer: Roland Turnill (partner) and Paul Dickson (partner) are leading the team.