Icahn is an expert in the automobile industry. He currently operates Icahn Automotive and holds 28% of Icahn Enterprises’ total net sales. Icahn Automotive was largely built through acquisitions. Icahn began his investment in Federal-Mogul 2001 and eventually acquired the whole company in 2017. Icahn also acquired substantially all the U.S. auto parts assets of Uni-Select, Inc., a leading automotive parts distributor for domestic and imported vehicles; Pep Boys – Manny, Moe & Jack, a leading aftermarket provider of automotive service, tires, parts and accessories across the U.S. and Puerto Rico; the franchise businesses of Precision Tune Auto Care; and American Driveline Systems. Federal-Mogul was sold to Tenneco by Icahn in 2018. Today, Icahn Automotive includes the Pep Boys aftermarket retailer and service chain, Auto Plus automotive parts distributor, Precision Tune Auto Care-owned and franchised automotive service centres, AAMCO Total Auto Care franchised services centers and Pep Boys automotive accessories. Icahn Automotive employs over 22,000 people, has over 2,000 franchise and company locations, as well as 25 distribution centers across the U.S. and Puerto Rico.  

Icahn not only knows a lot about this industry, but also has extensive knowledge of this particular company. Dana declared Chapter 11 bankruptcy in March 2006 and Icahn bought approximately $101.25 mil of its unsecured debt, which was then worth $2.2 million, with the intention to be an “active part” of the bankruptcy proceedings. Icahn became an equity shareholder in the fourth quarter 2020. He filed a passive 13G with 7.5% ownership on February 4, 2021. Since then, his intent has changed from passive-to active. He filed the 13D after he took two seats on the board.

There is no doubt that Icahn’s two portfolio managers, Brett Icahn and Gary Hu, will make value-added directors as they not only have industry experience, but are shareholder directors – either on its own is valuable for a board member, but it is very rare to have a director with both of those attributes. Icahn should create significant shareholder value if this is his only activity in the investment. 

But it’s hard to forget the elephant in the corner. Icahn created his automobile industry through acquisitions. Dana fits in well in IEP’s auto business. IEP stated in another statement that the strategy for its Automotive segment was to increase commercial parts sales as well as its automobile service business. IEP will also continue to explore strategic alternatives to its automotive aftermarket part business to optimize value. Pep Boys was acquired by Icahn in 2007. He also said that “we believe with our ample resources and industry knowledge we can grow this business, and take advantage of consolidating opportunities, which will benefit our customers, manufacturing partners, and employees as well as our shareholders.” Icahn may be considering Dana as an acquisition candidate or merger candidate, which is quite hard to believe. As an investor, who values shareholder value and corporate governance, we believe that Icahn would only acquire the company after an auction by an independent investment bank. We also expect an arms-length negotiations in which Icahn directors are not involved.

Ken Squire, the president and founder of 13D Monitor is an institution research service that focuses on shareholder activism. He also founded and managed the portfolio for the 13D Activist Fund which invests in a range of activist 13D investments. Dana is part of the fund.