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(Reuters) – Volkswagen AG’s VOWG_p.DE The Traton SE truck unit has agreed to pay about $ 3.7 billion for the outstanding shares of U.S. truck maker Navistar International Corp under a deal announced on Saturday that would expand its reach in North America.
The deal’s finalization comes after Traton said on Oct. 16 it had agreed to increase its offer on Navistar to $ 44.50 a share, from $ 43, as it ended in an acquisition that would create a global manufacturer.
The agreement between Navistar and the truck brands MAN, Scania and Volkswagen is in step with trends in the heavy truck industry looking for ways to share the costs of developing low-emission technology.
Traton already owns a 16.7% stake in Navistar and, at the increased offer price, Traton would pay around $ 3.7 billion for Navistar shares it does not already own, thereby valuing the US business in overall to about $ 4.4 billion.
Major Navistar shareholders, including Icahn Capital LP and MHR Fund Management LLC, have agreed to vote in favor of the deal, the US truck maker said in a separate statement bit.ly/3ezUrUS.
The Volkswagen group will grant Traton a loan of 3.3 billion euros, repayable over 12 to 18 months, to finance the operation.
Reporting by Aishwarya Nair in Bangalore; Edited by Catherine Evans and David Holmes
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