Volkswagen Secures 55.9% Majority in MAN
According to Bloomberg, VW Group has just acquired a ‘little’ more of MAN, as its stake has increased from 30.5 to 55.9 percent, making it the majority stakeholder. The deal is reportedly still pending regulatory approval, but is expected to lead to increased cooperation between Scania and MAN, helping both companies reduce overhead.
“Volkswagen is more than pleased with the result” of the tender, VW Chief Executive Officer Martin Winterkorn said in the statement.
Regulatory approval is needed because ombination of MAN and Scania would instantly surpass Volvo and Daimler, creating Europe’s largest maker in the process. MAN and Scania together had 30 percent of the European heavy-truck market last year, according to the European Automobile Manufacturers’ Association, while Volvo and Mercedes each had 21 percent.
“Given VW’s huge automotive net cash position and low automotive debt-to-earnings ratio, the company obviously has the financial resources and credit metrics headroom necessary,” to complete the deal, said Sven Kreitmair, an analyst at Unicredit in Munich. “We expect MAN in this case now to get upgraded to VW’s credit-rating level, rather than VW to get downgraded.”
VW took a controlling stake in Soedertaelje, Sweden-based Scania in 2008. The increased holding in MAN may allow the two truckmakers to get regulatory approval to share business information and work more closely together, cutting costs in the process.