Volkswagen Throws Down in Bid to Buy Navistar, Create Heavy Truck Giant

Corey Lewis
by Corey Lewis

When they’re not preparing to sell an ultra luxury super car brand or creating a new line of electric vehicles, they’re planning a big time merger for a larger piece of the heavy-duty truck market.

It’s only gonna cost them a few billion dollars.

Volkswagen’s commercial vehicle subsidiary, Traton SE, is currently one of the largest manufacturers of commercial vehicles in the world. The company was known until 2013 as Volkswagen Truck & Bus AG before VW decided on a less singular sounding name. Under the brand’s umbrella is MAN, Scania, and Volkswagen Trucks and Buses of Brazil. Last year the company sold roughly 242,000 vehicles globally, in the light-, medium-, and heavy-duty segments. But they didn’t sell anything in North America, which is where Navistar comes in.

Navistar has existed since 1986, when it was formed to contain what were previously the assets of International Harvester. The company’s current brand is International, and it makes trucks, buses, engines, and military vehicles. Its primary market is North America, which makes it extra tasty for Traton. Last year the company built 106,500 vehicles.

Currently Traton owns 16.8 percent of Navistar, but wants the rest of the shares. Its most recent share offer was $43 per, but it upped the ante on Friday to $44.50. If the deal goes through Traton would write a check for $3.7 billion, which would value Navistar’s entire operation at $4.4 billion. The two companies have agreed “in principle” that Traton will acquire all shares, but the paperwork’s not finalized yet. Hurdles include the due diligence, lawyer things like terms of the merger and documentation, and board approval at VW and Navistar.

The companies have been negotiating for a while now, and the share price offers from Traton have escalated under pressure from the board of Navistar. Traton started off with an initial price per share of $35. That was after the German firm had to convince billionare Carl Icahn to sell the 16.8 percent of Navistar shares he owned via an investment fund.

The market believes the deal will go through, as Navistar shares on Friday increased in value by 23 percent, to $43.55. Look for an announcement soonish on Traton-Navistar Global Truck Industries.

[Image: Navistar]

Corey Lewis
Corey Lewis

Interested in lots of cars and their various historical contexts. Started writing articles for TTAC in late 2016, when my first posts were QOTDs. From there I started a few new series like Rare Rides, Buy/Drive/Burn, Abandoned History, and most recently Rare Rides Icons. Operating from a home base in Cincinnati, Ohio, a relative auto journalist dead zone. Many of my articles are prompted by something I'll see on social media that sparks my interest and causes me to research. Finding articles and information from the early days of the internet and beyond that covers the little details lost to time: trim packages, color and wheel choices, interior fabrics. Beyond those, I'm fascinated by automotive industry experiments, both failures and successes. Lately I've taken an interest in AI, and generating "what if" type images for car models long dead. Reincarnating a modern Toyota Paseo, Lincoln Mark IX, or Isuzu Trooper through a text prompt is fun. Fun to post them on Twitter too, and watch people overreact. To that end, the social media I use most is Twitter, @CoreyLewis86. I also contribute pieces for Forbes Wheels and Forbes Home.

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  • Akear Akear on Oct 20, 2020

    Yet another American icon falls. I thought America was suppose to be good at making trucks.

  • Millerluke Millerluke on Oct 20, 2020

    Why the hell would a company that can't make compliant diesels buy a company that can't make a decent diesel or DPF system? Maybe cause no one else wanted International? The company I work for refuse to buy Internationals now, unless they absolutely have to - they'd rather spend upwards of $20,000 more for a Peterbilt or Kenworth!

  • Stephen My "mid-level" limited edition Tonino Lambo Ferraccio Junior watch has performed flawlessly with attractive understated style for nearly 20 years. Their cars are not so much to my taste-- my Acura NSX is just fine. Not sure why you have such condescension towards these excellent timepieces. They are attractive without unnecessary flamboyance, keep perfect time and are extremely reliable. They are also very reasonably priced.
  • Dana You don’t need park, you set auto hold (button on the console). Every BMW answers to ‘Hey, BMW’, but you can set your own personal wake word in iDrive. It takes less than 5 minutes to figure that that out, btw. The audio stays on which is handy for Teams meetings. Once your phone is out of range, the audio is stopped on the car. You can always press down on the audio volume wheel which will mute it, if it bothers you. I found all the controls very intuitive.
  • ToolGuy Not sure if I've ever said this, or if you were listening:• Learn to drive, people.Also, learn which vehicles to take home with you and which ones to walk away from. You are an adult now, think for yourself. (Those ads are lying to you. Your friendly neighborhood automotive dealer, also lying to you. Politicians? Lying to you. Oh yeah, learn how to vote lol.)Addendum for the weak-minded who think I am advocating some 'driver training' program: Learning is not something you do in school once for all time. Learning how to drive is not something that someone does for you. It is a continuous process driven by YOU. Learn how to learn how to drive, and learn to drive. Keep on learning how to drive. (You -- over there -- especially you, you kind of suck at driving. LOL.)Example: Do you know where your tires are? When you are 4 hours into a 6 hour interstate journey and change lanes, do you run over the raised center line retroreflective bumpers, or do you steer between them?
  • Mike Bradley Advertising, movies and TV, manufacturing, and car culture have all made speeding and crashing the ultimate tests of manhood. Throw in the political craziness and you've got a perfect soup of destruction and costs.
  • Lou_BC Jay Leno had said that EV's would be good since they could allow the continued existence of ICE cars for enthusiasts. That sentiment makes sense. Many buyers see vehicles as a necessary appliance.
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