Larry Yost, chairman and chief executive officer of ArvinMeritor, says the move came after Dana rejected its proposals and refused requests to enter discussions.
Yost adds: “The combined company will have the increased capability to accelerate growth, make strategic investments and enlarge our diversified portfolio of products and services.”
But he also raised the prospect of redundancies, saying: “Arvin-Meritor has a proven track record of successful integration of large-scale mergers and is committed to retaining the best and the brightest employees from each organisation.”
He expects to achieve yearly cost savings of $200m (£123m) as a result of the bid. Currently, ArvinMeritor, which was the result of a merger between Arvin Industries and Meritor Automotive three years ago, owns 1,085,300 shares of Dana's common stock.
Ohio-based Dana was founded in 1904 and employs 60,000 people. It specialises in axles, driveshafts, brake and chassis products as well as fluid systems, filtration products, bearings and sealing products. Michegan-based ArvinMeritor employs 32,000 and makes undercarriages, suspensions, exhausts, roofing, doors and braking systems.