Volkswagen eyes takeover of US truck maker Navistar | Business| Economy and finance news from a German perspective | DW | 16.04.2018
  1. Inhalt
  2. Navigation
  3. Weitere Inhalte
  4. Metanavigation
  5. Suche
  6. Choose from 30 Languages


Volkswagen eyes takeover of US truck maker Navistar

The heavy-vehicle division of the German carmaker is considering a full takeover of its US affiliate Navistar, as it outlined global growth plans that may include an initial public offering of its trucks unit.

Seeking scale to compete with global leaders Daimler and Volvo, Volkswagen's Truck & Bus division unveiled on Monday that it might consider boosting its existing stake of just under 17 percent of Navistar International — the United States' fourth-largest truck maker.

"[Taking over Navistar] would make sense at some point," the finance chief of the VW division, Matthias Gründler, told reporters on Monday.

The move would likely trigger a mandatory takeover offer, Gründler said, adding that it was nevertheless "theoretically possible."

The buyout would have a potential price tag of about "three to four billion," he noted, while declining to comment on a possible time frame for a deal.

Read more: Volkswagen names new CEO to steer sweeping overhaul

Any purchase could be funded by parent Volkswagen and wouldn't depend on an initial public offering (IPO) that the truck unit was considering. Gründler also said that cooperation between the two manufacturers was developing "very well."

Watch video 02:04
Now live
02:04 mins.

Volkswagen: Diess emphasises efficiency

Lukewarm response

Volkswagen bought its holding in Navistar in 2016 to gain a foothold in North America, where Daimler makes Freightliner vehicles and Volvo owns the Mack brand.

Navistar, whose largest shareholder is billionaire investor Carl Icahn, declined to comment on Volkswagen potentially purchasing a larger stake.

Lyndi McMillan, a spokeswoman for the company, said in an email to news agency Bloomberg that the companies' alliance "is already demonstrating strong progress" and was set for "continued success."

Navistar shares jumped 6 percent in early trading on Wall Street Monday, narrowing the decline this year to 8.3 percent and valuing the manufacturer at $3.91 billion. Volkswagen shares fell 2.7 percent in Frankfurt.

VW restructuring

Last week, VW group unveiled a thorough restructuring of its 12 brands, including preparing Truck & Bus division for a public listing or a debt sale scheduled to take place within the next 12 months.

Read more: Corporate wheel turns at VW, but workers are staying calm

At the news briefing on Monday, the head of VW Truck & Bus, Andreas Renschler, outlined global growth plans that included adding sales in China and sharing costs across its MAN, Scania and Brazilian VW commercial-vehicle operations through joint procurement and development of parts.

The comprehensive project would accelerate the transformation of the division, he said, making it "a true global champion" that would quickly become "ready for the capital markets."

He reiterated, though, that no decision had yet been made on an IPO. A listing of the truck and bus unit was "just one of the options," Rentschler said, adding that another would be to sell bonds. "It's ultimately a decision for our shareholders."

The revamp of the heavy-vehicle division marks the most significant structural shift so far for Volkswagen as Europe's biggest carmaker retools for massive change across its industry.

Watch video 04:22
Now live
04:22 mins.

Scandal? What scandal?

uhe/jd (Reuters, dpa, AFP)


DW recommends

Audios and videos on the topic