Volkswagen's Truck Unit Traton SE Offers to Buy U.S. Truck Maker Navistar for $2.9 Billion
【Summary】German truck manufacturer Traton SE, the truck division of automaker Volkswagen, has made a $2.9 billion offer to buy the remaining shares in U.S.-based truck maker Navistar International Corp. Traton currently owns a 16.8% stake in Navistar.
German truck manufacturer Traton SE, the truck division of automaker Volkswagen, has made a $2.9 billion offer to buy the remaining shares in Navistar International Corp. Traton currently owns a 16.8% stake in Navistar and has agreed to pay $35 per Navistar share for the remaining shares it doesn't own.
Naviatar confirmed the proposal from Traton SE and issued a statement saying it "has received an unsolicited proposal from Traton regarding a potential transaction to acquire the company for $35 per share in cash."
The news of Traton's proposal to buy Navistar sent the company's stock price up over 50% in after hours trading to $36.25. The company's share price was $27.04 after the closing bell on Thursday. Navistar's 2019 revenue was $11.25 billion.
In a press release today, Navistar wrote, "Navistar's Board of Directors, in consultation with its financial and legal advisors, will carefully review and evaluate the proposal in the context of Navistar's strategic plan for the company in order to determine the course of action that it believes is in the best interest of the company and its stakeholders."
Navistar declined to comment further on the proposal.
In a statement released today, the company wrote "Navistar does not intend to make any additional comments regarding the proposal unless and until it is appropriate to do so or a formal agreement has been reached."
The International LT Series Semi Truck.
Navistar is based in Illinois. One of its most recognizable brands is International Truck. International's LT Series, Prostar and Lonestar diesel-powered semi trucks are heavily used in the trucking industry and are a common sight on highways across the U.S. Its competitors include Freightliner, a division of Daimler Trucks North America, Peterbilt and Kenworth.
Navistar was once known as International Harvester Company and started out building agricultural machinery such as farm tractors. International Harvester was founded back in 1902 in Chicago. In 1986, the company reorganized and changed its name to Navistar International.
Navistar builds a complete lineup of International Trucks ranging from class 4-8 and military vehicles under its Navistar Defense division. The company also builds vehicles for the China market in a joint venture with Chinese Truck Maker Anhui Jianghuai Automobile Co. Ltd. (JAC).
Navistar's global headquarters are in Lisle, Illinois. The company employs around 3,000 employees work in Lisle across corporate finance, design and engineering, procurement, IT, International Trucks and Navistar Defense.
Traton Group is one of the world's largest commercial vehicle manufacturers. It produces trucks under the nameplates MAN, Scania AB, and Volkswagen Caminhões e Ônibus brands. In 2019, TRATON Group's brands sold around 242,000 vehicles. Traton builds light-duty commercial vehicles, trucks, and buses at 29 manufacturing and assembly sites in 17 countries.
Traton employs around 81,000 people.
Traton is also committed to building electric trucks and buses. Traton is developing a common modular electric powertrain toolkit, that it plans to use in the first serial produced all-electric city buses made by Scania and MAN, said Christian Levin, the Chief Operating Officer and Head of R&D at Traton at at the Group's Innovation Day in Södertälje, Sweden in October 2019.
Traton's CEO reiterated Traton's electrification plans.
"Our goal is to become the leading provider of e-trucks and e-buses," said Andreas Renschler, Member of the Board of Management of Volkswagen AG and CEO of Traton.
Renschler predicts that in the next 10 to 15 years one third of Traton's trucks and buses will have an alternative drivetrain, most of them fully electric.
The acquisition of Navistar, if approved, would give Traton ownership of one of the most recognizable U.S. truck brands, as well as its manufacturing facilities in the U.S. and around the world.
Originally hailing from New Jersey, Eric is a automotive & technology reporter covering the high-tech industry here in Silicon Valley. He has over 15 years of automotive experience and a bachelors degree in computer science. These skills, combined with technical writing and news reporting, allows him to fully understand and identify new and innovative technologies in the auto industry and beyond. He has worked at Uber on self-driving cars and as a technical writer, helping people to understand and work with technology.
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