Eaton Corporation 8-K

Summary

Eaton agreed to separate its Mobility business and combine it with Dana in a Reverse Morris Trust transaction, sharpening Eaton’s focus on Electrical and Aerospace. The deal is expected to close in Q1 2027, subject to Dana shareholder approval, regulatory clearances and customary conditions; Eaton expects the separation to be immediately accretive to its organic growth rate and operating margins upon closing.

Key Figures

• Eaton’s Mobility business is valued at ≈$5.1B, or 8.3x estimated 2026 pro forma adjusted EBITDA and 5.9x on a fully synergized basis.
• Eaton will receive an ≈$1.1B cash distribution, subject to adjustment for cash and indebtedness, funded by newly issued Mobility business debt. Eaton shareholders will own at least 50.1% of the combined company.
• Eaton will distribute SpinCo shares through either an exchange offer or a pro rata distribution, at its election; the combined company will operate as Dana and remain listed on the NYSE as DAN. The transaction is intended to be tax-free for U.S. federal income tax purposes.

Guidance

Investor Takeaways

• Watch for Dana shareholder approval, regulatory clearances and closing, currently expected in Q1 2027.
• Track whether the combined company realizes the projected run-rate synergies within 24 months after closing.