Volkswagen Group has secured enough financial support to push through with its EUR6.7 billion ($9.2 billion) bid to fully acquire Scania, around two-thirds of which it already controls. The carmaker has already gained shareholder support of 90.47 percent of the truck company – topping the 90-percent threshold required under Swedish law to force out remaining owners and delist Scania.
VW has been eager to take full control Scania in order to forge deeper three-way collaboration between the Swedish truck maker, MAN, and its own commercial-vehicles marque. The Scania acquisition will allow VW to create a global trucks division that can rival Daimler and Volvo.
VW chief executive Martin Winterkorn remarked that the commercial-vehicle business is increasingly becoming the group’s second strong pillar. He remarked that once VW completes its full takeover of Scania, it can take next “logical and consistent step” in the group’s strategy to strengthen its operational integration.
While VW has already spent billions of euros to buy stakes in Scania and MAN, it financial rewards has been limited by refusal of minority shareholders to pave way for technology sharing that could boost overall profit.
The combined businesses would become biggest truck producer in Europe, surpassing both Daimler and Volvo. VW has so far gained only EUR200 million in savings from joint projects among its light commercial-van unit, Scania and MAN.
Deeper cooperation among them in areas like drivetrains, chassis, cabins and electronics would lead to annual operating-profit synergies of EUR650 million.
Stefan Bratzel, director of the Center of Automotive Management at the University of Applied Sciences, told Bloomberg, the development of the truck businesses would take around 10 to 15 years, since it has taken too long to deepen cooperation between them. [source: Bloomberg]