Navistar Board Likes Traton’s Latest Bid

16 October 2020

Navistar International Corp. issued a response from its board of directors to a letter it received from Traton SE, formerly Volkswagen Truck & Bus AG, on Oct. 14 concerning a potential sale of the outstanding shares of Navistar that Traton does not already own.

Following discussions between Navistar and Traton, Navistar’s board confirmed that it would be prepared to move forward with a transaction in which Traton would acquire Navistar for $44.50 per share in cash, roughly $3.7 billion. In a letter to Traton, Navistar’s Board asked Traton to confirm that price as a basis for finalization of definitive agreements. Navistar said its board confirmed that an offer of $44.50 per share has the support of the company’s two largest shareholders.

In a letter from Navistar Executive Chairman Troy Clarke to Traton CEO Matthias Gründler, Clarke said, “Consistent with our conversations and your separate conversations with our two largest shareholders, the Navistar Board has asked me to confirm to you that it would be prepared to move forward with a transaction in which TRATON would acquire Navistar for US$44.50 per share in cash.

“Please confirm that a price of US$44.50 per share in cash is a basis for finalization of the definitive agreements and that you will promptly make a public announcement of the extension of your previously announced expiration of your offer to acquire Navistar to a date and time mutually agreed upon in order to proceed with the finalization of the definitive agreements for a transaction at US$44.50 per share in cash. An acquisition of Navistar by TRATON for $US44.50 per share has the support of both Icahn and MHR in their capacity as shareholders of Navistar.”

Earlier in the week, Traton had announced that its bid to acquire the shares of Navistar that it did not own would expire Oct. 16.

In late January, Traton made an initial offer of $35 per share. Traton already owns 16.8% of Navistar, the manufacturer of International brand trucks, which it purchased in 2016 for approximately $256 million.

In September, Navistar rejected a revised proposal from Traton in which the German company would acquire Navistar for $43 per share, saying that bid “significantly undervalues the company and substantial synergies from a combination, it does represent a starting point for further exploring the possibility of a transaction.”



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