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Dana Corporation to Divest Global Warner Electric Operations

14 June 1999

Dana Corporation to Divest Global Warner Electric Operations

    TOLEDO, Ohio, June 11 -- Dana Corporation today
announced plans for the largest divestiture in its history -- the sale of its
global Warner Electric Industrial Products Group and part of its Warner
Electric Industrial Motors and Controls Group.
    The proposed sale comes in response to recent interest from potential
buyers who expressed a desire to purchase certain of Dana's industrial
operations. This is consistent with Dana's previously announced Five-Point
Plan for continued growth and increased profitability.
    Excluded from the sale will be Dana's automotive motion control operations
in El Paso, Texas, and Chihuahua, Mexico; its American Electronic Components,
Inc., facilities serving automotive customers, located in Elkhart, Ind.; and
certain automotive engineering and test facilities located in Ann Arbor, Mich.
    The Warner Electric Industrial Products Group manufactures industrial
clutches and brakes, linear actuators, and ball bearing screws for a diverse
range of applications.  The Warner Electric Industrial Motors and Controls
Group produces a wide range of precision electric motors and controls,
electronic adjustable speed drives, power conditioning equipment, and voltage
and lighting controls.
    The groups had combined sales of approximately $360 million in 1998 and
employ approximately 3,000 people at 18 major manufacturing and assembly
facilities throughout the world.
    "This divestiture is important not only because of its size, but also
because it enables us to more effectively focus our vehicular electronic
capability.  It is another example of Dana's resolve to divest non-strategic
assets -- one of the elements of our Five-Point Plan," said Joe Magliochetti,
Dana president and CEO.
    Yesterday, Dana announced a similar decision to sell its Commercial
Vehicle Cab Systems Group, a $91 million manufacturer of truck mirrors,
windshield wiper systems and HVAC controls.  In March, Dana announced an
agreement to sell most of its constant-velocity joint business to GKN plc as
part of a strategic global alliance with that company.
    In April, Dana unveiled its Five-Point Plan, which is a tactical link to
the company's overall strategic plan.  The Five-Point Plan provides elements
for continued growth and profitability over the next 12 to 18 months.

    The plan includes the following five tactics:
    * Grow while focusing on returns and maintaining financial discipline;
    * Seek strategic, bolt-on acquisitions at reasonable valuations;
    * Divest non-strategic and non-performing operations;
    * Repurchase stock as the company generates cash; and
    * Complete integration efforts and realize synergy savings.

    Mike Plumley, president of Dana's Industrial Group, said, "Warner Electric
has been an important contributor to Dana, and we owe a debt of gratitude to
our people from those divisions.  I am confident Warner will grow further with
a company that is more focused on industrial products."
    Southwood J. Morcott, Dana chairman, said, "With this decision, Dana is
better positioned to leverage the resources of our vehicular electronic
controls and fluid system products to better serve our customers and provide
additional strategic growth."
    Dana has retained the investment-banking firm of J.P. Morgan & Co. Inc. to
assist in the transaction.
    Dana Corporation is one of the world's largest independent suppliers to
vehicle manufacturers and their related aftermarkets.  Founded in 1904 and
based in Toledo, Ohio, the company operates some 330 major facilities in
32 countries and employs more than 86,000 people. The company reported sales
of $12.5 billion in 1998. Dana's Internet address is http://www.dana.com .