VW motors ahead with MAN-Scania truck merger plan
FRANKFURT (Reuters) - German carmaker Volkswagen <VOWG_p.DE> formally launched its bid for MAN <MANG.DE> on Tuesday in a move toward creating Europe's biggest truckmaker.
VW's chairman Ferdinand Piech has long been itching to combine MAN and Sweden's Scania <SCVb.ST> to take on the world's biggest truck maker, Daimler <DAIGn.DE>, and number two Volvo <VOLVb.ST>, but has been hampered by anti-trust issues and resistance from Scania.
The German carmaker already owns a controlling stake in Scania and has triggered a mandatory offer for MAN by increasing its shareholding to more than 30 percent from 29.9 percent.
Its low-ball offer of 95 euros per share for MAN is seen as being deliberately unattractive in the same way as Spanish construction group ACS <ACS.MC> sought to build its stake in German rival Hochtief <HOTG.DE> without having to pay for the whole company.
Shares in MAN were trading 0.1 percent higher at 96.62 euros by 3:46 a.m. EDT on Tuesday, 1.7 percent above VW's offer price.
If few investors accept the offer, which values MAN at about 13.8 billion euros ($19.7 billion), VW will benefit by being allowed under German rules to then gradually buy shares in the market and by getting regulatory approval allowing closer cooperation between MAN and Scania.
In a first step, VW , which has a war chest of almost 20 billion euros, will spend about 1.5 billion euros to raise its stake in MAN to 35-40 percent of voting rights.
Eventually, it envisions a trucks group combining MAN and Scania and saving about 400 million euros of costs per year.
MAN will comment on VW's offer within two weeks, a spokesman for the truck maker said. He said MAN was in favor of cooperation with VW in principle as it saw industrial logic and potential savings in such a deal.
The announcement by VW, which is being advised on the deal by Credit Suisse <CSGN.VX>, comes five years after MAN tried and failed to take over Scania, leaving relations frosty.
Since then, the two companies have struggled to progress in talks under VW's guidance. Last month's 4.9 billion euro rights issue of Porsche SE <PSHG_p.DE>, VW's biggest shareholder, removed a stumbling block in VW's ability to shoulder takeovers.
(Reporting by Jan Schwartz and Andreas Kroener; Writing by Maria Sheahan; Editing by Greg Mahlich)