VW to buy out minority shareholders of Swedish truck maker Scania for $9.21 bn
22 Feb 2014
German car maker Volkswagen AG (VW) plans to take full control of its Swedish truck unit Scania AB by buying out minority shareholders for €6.7 billion ($9.21 billion).
VW, which together with its other trucks division MAN SE already owns 62.6 per cent of Scania, is offering to pay SEK 200 ($22) per Scania A and B share, a premium of 57 per cent to Scania A share and 53.3 per cent to Scania B share on the average prices of Scania's shares in the past 90 days.
Scania is one of the world's leading manufacturers of trucks and buses for the heavy transport industry, and of industrial and marine engines.
Employing around 41,000 people in around 100 countries, Scania generated a net income of SEK 6.2 billion in 2013 on revenues of SEK 86.8 billion.
While its research and development activities are concentrated in Sweden, its production centres are located in Europe and South America.
VW, which had.invested in Scania in 2000, said that until it takes full control of the Swedish commercial vehicles maker, ''it is not possible to leverage the full potential of closer cooperation at an operational level between VW and Scania, as well as between MAN and Scania, due to the legal restrictions in place to protect the minority shareholders in Scania.
VW said that a complete merger will generate additional synergies of at least €650 million per year from joint development and other steps, but added that in light of the long product lifecycles in the commercial vehicles industry, it will be 10 to 15 years before this potential synergy can be fully achieved.
''The plan to fully integrate Scania into the Volkswagen Group follows a compelling industrial logic. It will significantly improve the capabilities, efficiency and flexibility of the commercial vehicles group comprising Scania, MAN and Volkswagen Commercial Vehicles, for example by implementing a common toolkit strategy similar to the one used in our passenger cars", said Dr. Leif Östling, member of the board of management of VW.
