TOLEDO, Ohio, (July 23, 2003) — Dana Corp.’s Board of Directors is telling its shareholders to reject an unsolicited tender offer from ArvinMeritor for all outstanding shares of Dana common stock.

In a hostile takeover bid two weeks ago, ArvinMeritor, which currently owns 1,085,300 shares of Dana’s common stock, made a proposal directly to Dana shareholders for $15.00 per share in cash. At the time, Larry Yost, chairman and CEO of ArvinMeritor, stated he would have preferred to meet with the Dana Board and its advisors to discuss an all-cash offer and negotiate a mutually acceptable transaction. “However, Dana has rejected our prior proposals and refused our requests to enter into discussions,” he said.

Dana filed a Schedule 14D-9 with the Securities and Exchange
Commission yesterday, recommending that its shareholders not tender their stock in response to the offer. The company stated “ArvinMeritor’s offer is a financially inadequate, high-risk proposal that is not in the best interests of Dana or its shareholders.”

In addition, the Board cited significant financing risks and serious antitrust concerns raised by the offer that could prevent its completion. Because Dana and ArvinMeritor combined make up 80 to 100 per cent of the axle, driveshaft, and foundation brake market for medium and heavy-duty trucks, the proposed transaction may result in litigation by antitrust authorities to block the offer, Dana said in a press release. Moreover, Dana is also trying to turn shareholders away from the deal by claiming ArvinMeritor would need to arrange substantial borrowings to consummate its offer, and the size of the required financing would result in ArvinMeritor having the highest debt-to-capital ratio in the automotive supply industry.

“There is virtually no rationale for accepting this offer, which represents inadequate value and a high level of risk for shareholders,” said Dana CEO Joe Magliochetti.

However, ArvinMeritor was unwavering in its position. “Despite the fact that the Dana Board has rejected our offer and refuses to negotiate with us, we are committed to this transaction,” the company immediately responded through its own press release. “Our offer permits Dana’s shareowners to realize an attractive cash value for their shares today without bearing the risks of Dana’s long-term restructuring efforts … We believe that Dana’s response recites a litany of manufactured reasons to oppose this combination.”

ArvinMeritor also indicated it would be prepared to analyze whether a higher value for the stock is warranted, but only if Dana’s Board is willing to open dialogue on consummating a transaction quickly.

The tender offer for $15 per share and withdrawal rights are scheduled to expire at 5:00 p.m., on August 28, 2003, unless extended.