Allison Transmission acquires Dana Inc.’s off-highway unit for $2.7B

Allison Transmission acquires Dana Inc.’s off-highway unit for $2.7B

Allison Transmission has announced the acquisition of Dana Inc.’s off-highway business for $2.7 billion, marking a significant expansion in its global powertrain capabilities. The deal, expected to close in the fourth quarter of 2025, will integrate Dana’s off-highway operations, which span 25 countries and employ around 11,000 workers. This acquisition targets the construction, forestry, agriculture, mining, and industrial segments, bolstering Allison’s existing commercial vehicle focus.

Allison Transmission, known for its automatic transmissions and propulsion systems, aims to leverage Dana’s expertise in axles, drivetrain components, and hybrid-electric propulsion systems. The acquisition will enhance Allison’s global presence and drive technological innovation, particularly in the growing electrification market.

David Graziosi, Allison Transmission’s chair and CEO, stated, “This acquisition marks a transformative milestone in our commitment to propulsion and drivetrain innovation. We’re not just buying a business—we’re buying the next chapter of how the world moves” [3].

The transaction is expected to be immediately accretive to Allison’s earnings per share, with projected annual synergies of $120 million. The deal will be financed through a combination of cash and debt, pending regulatory approvals. Dana’s off-highway business brings expertise in hybrid and electric drive systems for off-highway applications, strengthening Allison’s position in the electrification market [4].

Dana Inc. announced its intent to sell its off-highway segment in November 2024. The sale is part of Dana’s strategy to focus on its light and commercial vehicle businesses and reduce the complexity of its operations. The company expects the sale to generate $2.4 billion in net cash proceeds after closing, with plans to use about $2 billion to repay debt and reduce spending by another $300 million through ongoing cost-savings initiatives [1].

The acquisition is a strategic move for both companies. Allison gains a broader global footprint and enhanced technological capabilities, while Dana focuses on its core businesses and optimizes its balance sheet. The deal underscores the industry’s shift towards electrification and the growing demand for specialized drivetrain components in off-road vehicles.

References:

[1] https://www.automotivedive.com/news/allison-transmission-dana-offhighway-acquisition/750586/
[2] https://finance.yahoo.com/news/allison-transmission-acquires-dana-inc-090000874.html
[3] https://usaherald.com/allison-transmission-to-acquire-danas-off-highway-unit-for-2-7b/
[4] https://www.stocktitan.net/news/ALSN/allison-transmission-announces-acquisition-of-dana-s-off-highway-os1x9xht9nkl.html
[5] https://finance.yahoo.com/news/dana-finalises-2-7bn-off-104320119.html