(Adds trader and analyst comments, updates with closing share price)
CHICAGO, Sept 23 (Reuters) - Auto parts maker Dana Corp. , which is battling a $2.2 billion hostile takeover bid, said on Tuesday its chairman and chief executive died from complications from pancreatitis.
Joseph Magliochetti, 61, died Monday evening following the removal of a gallstone. Magliochetti had been hospitalized for the ailment two weeks ago.
He had been fighting a hostile takeover bid from rival auto parts maker ArvinMeritor Inc. , arguing that antitrust concerns and divestitures that would result from a combination would make the deal pointless.
Dana shares edged further past ArvinMeritor's $15 asking price on the news as the market sensed that Magliochetti's death could prompt a deal to happen, analysts said. Shares gained 25 cents, or 1.6 percent, to end at $15.90 on the New York Stock Exchange on Tuesday.
"It could be a knee-jerk reaction from the market thinking that with the CEO having passed away that Dana might be more vulnerable," said Peter Lobravico, head of merger arbitrage trading at New York-based brokerage firm Wall Street Access.
Dana, based in Toledo, Ohio, said Glen Hiner, a longtime director, was named acting chairman. Bill Carroll, president of Dana's automotive systems group, was appointed acting president and will continue to serve as chief operating officer.
Magliochetti became chairman in 2000 and chief executive in 1999. He led Dana through a restructuring that closed more than 30 plants in two years.
Lobravico said ArvinMeritor might need to tread lightly before pursuing the takeover with any more vigor.
"ArvinMeritor definitely has to walk on eggshells here a little bit," Lobravico said. "Dana just had a death, and to come out and force them to the negotiating table could be viewed as being in poor taste by the public."
One Wall Street analyst said Magliochetti was Dana's "spiritual leader" in the battle to remain independent, but his successor would likely oppose a merger with equal vigor. "I don't think it changes things all that dramatically," the analyst said.
An ArvinMeritor spokeswoman declined to comment on whether the management change would affect the company's takeover bid, which has been marred by lawsuits from both sides.
ArvinMeritor, based in Troy, Michigan, launched its bid in July. In August, it extended the offer, and set a new deadline of Oct. 2 for shareholders to tender their shares.
Magliochetti is survived by his wife, Kathy, three children and one grandchild.
He began as a management trainee in 1966 at a Chicago company that was absorbed by Dana the following year. He was at the company since, serving in a variety of managerial roles.
Magliochetti was also a director of BellSouth Corp. and Cigna Corp. and a past chairman of the Motor and Equipment Manufacturers Association.
(Additional reporting by Jeffrey Goldfarb and Karen Padley)