Volkswagen’s Traton In $3.7B Deal To Snap Up Navistar; Street Says Hold
Volkswagen’s truck unit Traton has finally reached an agreement to snap up Navistar International in an $3.7 billion equity deal to expand its footprint in North America.
According to the terms of the deal, Traton will buy all of the outstanding shares of Navistar (NAV) it doesn’t already own, at a price of 44.50 per share in cash. The US truck maker’s shares closed less than 1% higher at $43.37 on Friday. Traton currently owns 16.7% of Navistar’s common stock, which the German automaker bought in 2016.
The signing of the deal comes after Traton raised its purchase offer for the US peer from $43 per share in October and from the $35 per Navistar share offered at the end of January.
“This transaction builds upon our highly collaborative and successful strategic alliance and further enhances the growth trajectory of the combined company, while delivering immediate and substantial value to our shareholders,” said Navistar CEO Persio Lisboa. “We look forward to continuing to work with the Traton team to create opportunities for our employees and provide an outstanding experience for our customers and dealers through best-in-class products, services and technologies.”
The deal is expected to close in mid 2021, pending Navistar shareholder approval, customary closing conditions as well as regulatory approvals. Major shareholders, including Icahn Capital and MHR Fund Management, have already agreed to vote in favor of the transaction.
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