In its continued struggle to make Europe’s biggest truck maker, VW AG has decided to announce a bid of 6.7 billion euros ($9.21 billion) to buy out the remainder of Swedish trucks division Scania.
Decided to fight Daimler, which is currently the world’s biggest truck maker, Volkswagen has been spending billions of euros over the last decade to expand the company’s control over Scania and MAN.
“We are launching this takeover offer to remove restrictions to a deeper cooperation between Scania and MAN,” said Finance Chief Hans Dieter Poetsch.
VW, which alongside MAN already owns 62.6 % of Scania’s shares and 89.2 % of the votes, said in a statement that it would draw the needed cash from its 16.9 billion euros reserve (2 billion euros), sell preferred shares for up to 2 billion euros and issue hybrid capital of up to another 3 billion euros.
“We are convinced that this strategic transaction will add substantial value to Volkswagen but it needs some time before it meaningfully impacts our finances … But we expect it to be EPS (earnings per share) accretive within a few years,” said Hans Dieter Poetsch, VW’s finance chief.
The German automaker also announced that at the top of its truck unit, former Daimler executive Andreas Renschler would succeed current chief Leif Oestling since February 1, 2015.