24th
November 2008 - Dana
Holding Corporation Secures Amended Credit Facility; Agreement Provides
for Strategic Flexibility
Dana Holding Corporation announced today
that it has received the requisite support of its lenders to amend the
financial covenants for its $1.3 billion
senior secured term credit facility.
The amendment improves the ratios
permissible for leverage and interest coverage. This covers the
company's financial covenants for each fiscal quarter through 2012. The
financial covenants in the term credit facility are calculated and
determined at the end of each quarter. Dana anticipates being in
compliance with the amended covenants as of December 31, 2008.
Dana also received permission to dispose
of certain non-core businesses and issue additional debt outside
the United States. These amendments will provide Dana with
greater flexibility as it considers strategic options and implements its
restructuring plans.
In connection with the amendment of its
term credit facility, Dana has agreed to pay an amendment fee and
increase the annual base interest rate by 50 basis points per annum and
will repay $150 million of outstanding principal under
the term credit facility.
As of October 31, 2008,
the company had approximately $1 billion in unrestricted
cash.
"As we reported during our recent
third-quarter earnings announcement, tumultuous industry conditions and
our resulting outlook for the balance of the year suggested that the
renegotiation of our loan covenants was prudent," said Dana Executive
Vice President and Chief Financial Officer Jim Yost.
"These modifications position us to be in compliance with our key
financial covenants going forward and provide the flexibility needed to
achieve our strategic imperatives."
About Dana Holding Corporation
Dana is a world leader in the supply of
axles; driveshafts; and structural, sealing, and thermal-management
products; as well as genuine service parts. The company's customer base
includes virtually every major vehicle manufacturer in the global
automotive, commercial vehicle, and off- highway markets, which
collectively produce approximately 70 million vehicles annually. Based
in Toledo, Ohio, the company's continuing
operations employ approximately 32,000 people in 26 countries and
reported 2007 sales of $8.7 billion.
Source: Dana Holding Corporation Press
Release