Report – VW considering bigger stake in Scania image

According to a report from the Wall Street Journal, who cited people familiar with the matter, Volkswagen is actively considering whether to increase its majority stake in Swedish truck maker Scania AB.

Together with truck maker Man, which is also controlled by the German group, VW holds big stakes of voting-strong A shares in Scania because of Sweden’s dual share system, which gives the duo nearly 90 % of votes in the company, while only holding around 60 % of the capital.

The people, who asked not to be identified discussing private proceedings, said that Volkswagen at the moment has not committed to a firm plan and a purchase isn’t imminent. Scania’s remaining shares would have VW pay 41.8 billion kronor ($6.4 billion) at yesterday’s closing stock price.

“Strategically it would make sense for VW to increase its stake in Scania at some point to have more control over the company,” said Sascha Gommel, a Frankfurt-based analyst at Commerzbank AG. “The planned short-term cost synergies seem to materialize, but the question is how this will work in the long run.”

The Swedish truck maker’ value climbed last year to 109 billion kronor as the shares appreciated by 4.2 over the entire 2013. Commenting the report, industry analysts consider Volkswagen move to buy out minority shareholders would be highly unusual as they already control the company via the management and supervisory board.

Via Reuters, Bloomberg