DETROIT Dana Corp. has won financing commitments that position the company for an exit soon from Chapter 11 court reorganization. The supplier has also come to terms with an investment group that threatened to oppose its reorganization plan.
Dana said this week it has obtained commitments from three Wall Street financiers for a $2 billion financing package. The commitments ensure that Dana will be positioned to emerge from bankruptcy by the end of January 2008, or earlier, according to the company.
In a statement, Dana said the exit financing would be underwritten by Citigroup Global Markets Inc., Lehman Brothers Inc. and Barclays Capital. It will consist of a $650 million asset-based revolving credit line and a $1.35 billion term loan, the supplier said.
Meanwhile, investor Appaloosa Management LP agreed on Wednesday to withdraw its appeal of a bankruptcy court's approval of Centerbridge Capital Partners as Dana's lead investor.
Appaloosa said Dana's unsecured creditors committee has agreed to support the hedge fund's application to receive $2 million for expenses it incurred during its participation in Dana's bankruptcy proceedings.
According to the court filing, Dana's debtors have decided not to take a stance on Appaloosa's application for expense reimbursement. Appaloosa, which has also been a key play in the Delphi Corp. bankruptcy case, made its own offer to help move Dana out of bankruptcy, but the bid failed.
Based in Toledo, Ohio, Dana ranks No. 20 on the Automotive News list of the top 100 global suppliers with worldwide original-equipment automotive parts sales of $8.50 billion in 2006. The 103-year-old company filed for bankruptcy protection in March 2006.