Swedish Wallenberg family blocks SCANIA takeover bid, again.

Posted on 08. Nov, 2006 by Ryan in 2000-2009, Scania Trucks & Busses, Södertalje, Sweden

Today, Tuesday, November 7th, 2006, the Wallenberg family blocked the merger by MAN, the Germany truck company by buying back more shares of SCANIA.

A superb job by Investor & the Wallenbergs! Please keep up the hard work and do not let the Germans take over SCANIA.

The original story for immediate release:

November 7th, 2006

Investor buys veto stake in Scania

By David Ibison in Stockholm and Richard Milne in Frankfurt

Published: November 7 2006 15:06 | Last updated: November 7 2006 15:06

Sweden’s Wallenberg family has seized the initiative in the battle for control of Scania, the truck-maker, by acquiring enough shares to block a forced merger by MAN, the German truck company.

Investor, the Wallenbergs’ holding company, on Tuesday bought Scania A and B shares, which, when added to shares held by the family’s foundation, raise its voting stake in the A shares to more than 33 per cent.

MAN, headed by Hakan Samuelsson, has made a €10.3bn ($13.2bn) hostile bid for Scania, rejected by both the truck-maker and Investor. They have argued that the offer undervalues the company.

Volkswagen, the largest shareholder of both MAN and Scania, prefers a friendly merger but has intimated it is prepared to back MAN’s bid for Scania, in part because of its frustration with Investor.

However, any forced merger of Scania requires approval from two-thirds of the holders of Scania’s A and B shares, meaning Monday’s move gives Investor veto power.

“It is Sweden against Germany now,” said one adviser involved in the negotiations. Another person close to the negotiations said: “It makes it impossible for MAN to go hostile.” Investor’s aggressive move is likely to put intense pressure on MAN to revise its offer. Investor is understood to want a higher price, an equity stake in the merged entity and a significant level of control.

“Standing alone [for Scania] is one possible outcome,” Börje Ekholm, chief executive of Investor, told the Financial Times. “A combination clearly has industrial synergies but achieving them depends on execution post-transaction, and we believe Scania can play a vital role.”

MAN declined to comment because of the sensitivity of the talks between it, Scania, VW and Investor.

But people close to the German truckmaker admitted the move did not help their position.

“It makes it significantly more difficult to push this through and probably a lot more expensive,” one said.

However, other people involved in the talks on the German side said they thought Investor was positioning itself ahead of final negotiations.

One possible response for MAN could be ask the Swedish market regulator to investigate whether Investor and the Wallenbergs are acting in concert and therefore would have to launch a takeover offer for all of Scania.

But such a decision is for the regulator alone and the chances of such a ruling are seen by those on the German side as low. Mr Ekholm emphasised that Investor and the Wallenberg foundation were not acting in concert. Investor’s stake in Scania is 20.01 per cent.

For the entire story visit http://www.ft.com/cms/s/e06b3fb8-6e70-11db-b5c4-0000779e2340.html

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