Traton’s expansion into the North American market now finds itself on the home stretch: The Volkswagen commercial vehicle subsidiary has just signed a binding takeover agreement with the US commercial vehicle manufacturer Navistar. The transaction is expected to be completed in mid-2021.
The billion-euro acquisition of the US company has been in discussion for years. The takeover is based on a strategic alliance that has linked the two groups since 2017. Through joint purchasing and new technology collaboration and complementary positioning in different markets in Europe, South and North America, a global company is now to be created that is “well-positioned to benefit from the enhanced brand performance, increased innovation and industry-leading capabilities,” according to Traton.
Under the terms of the agreement, the Volkswagen commercial vehicle subsidiary will acquire all outstanding common shares of Navistar at a cash price of $44.50 per share. Traton currently holds 16.7 per cent of the US group. The financing is estimated at 3.7 billion US dollars (approximately 3.11 billion euros) and will be provided by Volkswagen. Traton intends to maintain its investment-grade rating even after the transaction is completed, the company said. Meanwhile, the merger has yet to be approved by Navistar shareholders and the relevant regulatory authorities.
“Today’s announcement accelerates our Global Champion Strategy by expanding our reach across key truck markets worldwide, including scale and capabilities to deliver cutting-edge products, technologies and services to our customers,” said Matthias Gründler, CEO of Traton. “Together, we will have an enhanced ability to meet the demands of new regulations and rapidly developing technologies in connectivity, propulsion and autonomous driving for customers around the world.”
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“The acquisition of Navistar will significantly leverage Traton’s positioning in North America, one of the biggest and most profitable markets for heavy trucks. Together, the companies can enhance the scale and reach in key markets as well as create further synergies,” added Gunnar Kilian, Member of the Board of Management of Volkswagen AG responsible for Human Resources and the Truck & Bus Division.
Meanwhile, Traton plans to finalise the details of its cooperation in the development of electric drives for commercial vehicles with Toyota’s commercial vehicle subsidiary Hino under a recently signed joint venture agreement by the end of the year. Among other things, it is to be agreed which tasks and development priorities will be performed by the MAN, Scania and Volkswagen Caminhões e Ônibus (VWCO) brands on the one hand and Hino on the other.
Traton boss Matthias Gründler recently described the new joint venture as the next important step in the company’s electrification strategy. Against this background, Gründler also reaffirmed the Traton Group’s goal, made public last year, of investing one billion euros in electrification by 2025. Traton has created a common modular electric powertrain for its MAN, Scania and Volkswagen Caminhões e Ônibus (VWCO) brands, which has been used since this year in the first series-produced electric city buses from Scania and MAN and will be individually adapted depending on brand and application.
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