NEW YORK (July 10)—In a research report issued a day after ArvinMeritor Inc. announced it plans to make a hostile bid for Dana Corp., Merrill Lynch & Co. Inc. said it expects the battle to be long and arduous for three reasons. The capital structure of the deal seems "untenable," said lead report analyst John Casesa, meaning that ArvinMeritor may have to issue more equity, "thus diluting the benefits of the deal." Merrill Lynch also believes Dana will "fight tooth and nail" to remain independent, helped along by its shareholder rights or poison pill provision and by its incorporation in Virginia, a target-friendly state. Regulatory hurdles may also undermine the deal's strategic merits, Casesa said. Like other firms, Merrill Lynch has concerns that the combination of ArvinMeritor´s and Dana's commercial vehicle axle and aftermarket filter businesses may raise antitrust concerns.