Dana Inc. announced Tuesday it has agreed to combine with Eaton Corporation's Mobility business unit in a $5.1 billion transaction aimed at creating a more comprehensive supplier to the automotive industry.

The deal would merge two significant players in the automotive parts sector, with the combined entity expected to serve both commercial vehicle and light-duty vehicle markets more effectively. Dana, which manufactures drivetrain and power technologies, would gain access to Eaton's mobility technologies and expanded market presence.

The transaction represents one of the larger consolidation moves in the automotive supplier industry as companies seek to achieve greater scale and diversification amid evolving vehicle technologies. The combined company would have a broader portfolio of products and services for automakers.

Financial terms and the expected closing timeline for the deal were not immediately detailed in the announcement. The transaction would need to clear standard regulatory approvals before completion.