Volkswagen moves closer to integrated commercial vehicles group

The Volkswagen Group has moved a key step closer towards realising its goal of an integrated commercial vehicles group consisting of MAN, Scania and Volkswagen by the acquisition of the majority shareholding in MAN SE. “This marks the birth of a new top player on the global truck market,” Prof. Dr. Martin Winterkorn, CEO of Volkswagen Aktiengesellschaft, said in Wolfsburg on Wednesday. Following settlement of the mandatory offer, Europe’s largest automaker now holds 55.90 per cent of the voting rights and 53.71 per cent of the share capital of MAN SE.

In early May 2011, Volkswagen Aktiengesellschaft increased its holdings in ordinary shares in MAN SE from 29.9 per cent to 30.47 per cent. Due to crossing the threshold of 30 per cent of the voting rights in MAN SE, German takeover law required Volkswagen to make a mandatory offer to all shareholders of MAN SE to acquire their shares in MAN SE. Until the end of the acceptance period on June 29, 2011, MAN shareholders had tendered 35,857,607 ordinary shares and 164,613 preference shares into the Volkswagen offer.

Volkswagen, MAN and Scania are convinced of the industrial logic of a closer cooperation. This latest step is expected to generate annual synergies of at least EUR 200 million. Initially, these will relate to procurement activities, followed in the medium and long term by a closer cooperation in research and development as well as production.

CEO Winterkorn again stressed that the brand-specific characteristics and business areas of MAN are to remain unaffected. “That is the basic principle of our successful multi-brand strategy,” Winterkorn said. He also stated that Volkswagen would of course respect existing co-determination and employee rights to the full extent and be supportive of the locations and employees. “Together with the management and employees of MAN and Scania, we want to make the integrated commercial vehicles group a success for all customers and shareholders,” Winterkorn added.

By this closer cooperation, in particular MAN and Scania can further increase their profitability. Volkswagen as the largest shareholder of both companies will benefit from the related value enhancement, as will the other shareholders of MAN and Scania. At the same time Volkswagen is keeping all options open to further shape an integrated commercial vehicles group going forward.

The size of Volkswagen’s participation in Scania also changes as a result of the acquisition of the majority shareholding in MAN: Since the stake in Scania held by MAN is now attributable to Volkswagen, Volkswagen’s shareholding in the Swedish truck maker Scania increases to 89.2 (formerly 71.8) per cent of the voting rights and 62.6 (49.3) per cent of the share capital.