TRATON, Navistar announce definitive merger agreement at $44.50 per share, total cost nearly $3.7 billion

TRATON, Navistar announce definitive merger agreement at $44.50 per share, total cost nearly $3.7 billion
The merger between TRATON SE and Navistar International Corp. has been finalized, with TRATON purchasing all outstanding shares at a total cost of nearly $3.7 billion. (Courtesy: Navistar)

MUNICH and LISLE, Ill. — TRATON SE and Navistar International Corp. announced Nov. 7 that the two companies have reached a definitive merger agreement. Under the agreement, TRATON will become the owner of all of the outstanding common shares of Navistar not already owned by TRATON at a price of $44.50 USD per share in cash — a final cost of cost of nearly $3.7 billion USD.

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“Together, we will have an enhanced ability to meet the demands of new regulations and rapidly developing technologies in connectivity, propulsion and autonomous driving for customers around the world,” said Matthias Gründler, CEO of TRATON. “Navistar has been a valuable partner, and we are confident this combination will deliver compelling strategic and financial benefits, create enhanced opportunities for both Navistar and TRATON, and best position us to drive sustained value in the evolving global commercial vehicle industry.”

TRATON and Navistar formed a strategic alliance in March 2017 that allows both companies to benefit from an increased purchasing scale and the integration of new technologies.

“This transaction builds upon our highly collaborative and successful strategic alliance and further enhances the growth trajectory of the combined company, while delivering immediate and substantial value to our shareholders,” said Persio Lisboa, president and CEO of Navistar. “We look forward to continuing to work with the TRATON team to create opportunities for our employees and provide an outstanding experience for our customers and dealers through best-in-class products, services and technologies.”

According to a prepared statement released by TRATON and Navistar, the merger builds on the success of the 2017 alliance by combining TRATON’s strong position in Europe and substantial presence in South America with Navistar’s footprint in North America to create a well-positioned global company.

As TRATON’s biggest shareholder, Volkswagen also has a stake in the merger.

“The agreement is … an important milestone for Volkswagen because it underpins our strong strategic commitment to continue driving growth also during the ongoing challenging economic climate,” said Gunnar Kilian, member of the board of management of Volkswagen AG and responsible for Volkswagen’s truck and bus division. “The acquisition of Navistar will significantly leverage TRATON’s positioning in North America, one of the biggest and most profitable markets for heavy trucks. Together, the companies can enhance scale and reach in key markets as well as create further synergies.”

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