Volkswagen AG’s heavy-truck division the Traton Group said it will accept a counteroffer issued by IC Bus parent company Navistar International Corporation, to acquire all remaining shares.
Traton already owns 16.8 percent of Navistar, based in Lisle, Illinois, which was the result of a 2016 joint procurement venture partnership. Formally known as WV Truck and Bus, Traton inked a $265-million deal with Navistar that year, with Navistar stating at the time that the money would be used for “general corporate purposes,” according to a 2017 press release.
On Oct. 16, Traton announced it had agreed to purchase the remaining shares in Navistar at a $44.50 share-price, Transport Topics reported.
The deal reportedly started in earnest 10 months ago, when Traton offered $35 a share to Navistar. However, following the outbreak of the novel coronavirus, Traton boosted its bid to $43 in the middle of August.
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Navistar then countered with the share price of $44.50. Navistar stated in a letter to Traton that both Carl Icahn and MHR Fund Management, the largest shareholders of Navistar, support the acquisition.
If the deal goes through, Traton will pay a total of $3.7 billion for the remaining shares.
“We are pleased to have reached [an] agreement in principle for a transaction after intensive negotiations with Navistar,” Traton CEO Matthias Gründler said in a release. “We are looking forward to completing our due diligence and obtaining the necessary approvals in respect of this exciting deal in order to welcome the new Traton family member.”
School Transportation News reached out to Navistar to ask what the acquisition could mean for IC Bus, but a spokesperson said there were no details to share at this writing. But the company did provide the following statement.
“Traton and Navistar reached an agreement in principle that Traton will acquire Navistar for $44.50 per share in cash,” said a corporate communications official for Navistar. “Binding and enforceable commitment will result only from a definitive written agreement approved by both boards, as well as shareholder and regulatory approvals.”
In 2018, at the on-set of TRATON’s name change, Navistar reported that the partnership was already demonstrating “strong progress,” according to a School Transportation News report.
At the time, the electric IC Bus named chargE was touring the western U.S. The electric vehicle concept was produced in collaboration with Navistar and the Volkswagen Truck & Bus division, or TRATON. As of early September, IC Bus announced its first electric school bus order, which has been awarded to British Columbia. The purchase of 18 type C electric school buses was funded through the annual British Columbia Provincial School Bus Standing Offer.
Delivery of the new IC Bus electric is scheduled to begin in January.