Volkswagen Raises Navistar Offer to $ 44.50 Per Share to Close Truck Deal

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The announcement follows hours of negotiations, with Navistar’s board of directors saying the offer should be raised to $ 44.50 per share to gain shareholder support, hours before the offer expires of $ 43 per Traton share.



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Traton reportedly pays around $ 3.7 billion for Navistar shares he doesn’t already own

Volkswagen’s truck company Traton said on Friday it had agreed to increase its takeover bid for Navistar International Corp to $ 44.50 a share for $ 43, reaching a deal that would expand its reach in America North. A successful merger would bring truck brands MAN, Scania and Volkswagen together with Navistar to create a global manufacturer, at a time when the industry is looking for ways to share the costs of developing low-emission technology.

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At $ 44.50 per share, Traton would pay around $ 3.7 billion for shares in Navistar that it does not already own, valuing the U.S. company as a whole at around $ 4.4 billion.

“Traton SE and US-American truck maker Navistar International Corporation, in which Traton already has a 16.8% stake, today reached an agreement in principle that Traton will merge all shares of Navistar not already owned by Traton, at a price of $ 44.50 per Navistar share, ”Traton said in a statement.

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A deal depends on the completion of due diligence, the agreement of merger terms and related transaction documents and approval by the executive bodies of Navistar and Volkswagen, Traton said.

“There is no guarantee that the parties will come to an agreement on the final documentation of the transaction, or on the terms thereof or that any transaction, if such an agreement is reached, will ultimately be carried out,” warned Traton.

The announcement follows hours of negotiations, with Navistar’s board of directors saying the offer should be raised to $ 44.50 per share to gain shareholder support, hours before the offer expires of $ 43 per Traton share.

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Traton had already raised its initial offer of $ 35 per share last month. Shares of Navistar were last up 22.9% to $ 43.53. The Traton share finished up 1.6% to 18.02 euros. Traton struggled to win over billionaire activist investor Carl Icahn, whose fund had a 16.8% stake in the U.S. truck maker as of June 30, according to Refinitiv Eikon Data. Icahn and two other activist funds, Mark Rachesky’s MHR Fund Management and Gabelli Funds, together own around 40% of Navistar’s shares, according to data from Refinitiv.

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