Volkswagen AG’s truck unit Traton SE said on Saturday it had signed a merger agreement with U.S. truck maker Navistar International Corp in a deal that would extend its reach into North America.
The deal will see Traton acquire all common shares in Navistar at $44.50 per share, excluding the 16.7 percent stake that it already holds, the statement said.
At $44.50 per share, Traton would pay about $3.7 billion for the shares in Navistar it doesn’t already own, valuing the U.S. business as a whole at around $4.4 billion.
The merger would combine the MAN, Scania, and Volkswagen trucks brands with Navistar to create a global manufacturer, at a time when the industry is seeking ways to share the costs of developing low emissions technology.
Navistar did not immediately respond when Reuters contacted it for a comment on Saturday.
In a separate statement, Traton said that the deal will be financed through Volkswagen International Luxemburg S.A and a loan agreement has been concluded.
Traton last month sweetened its takeover bid for Navistar from $43 per share to $44.50 per share.
By Aishwarya Nair