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MAN and Scania = MANia

  • 25 February 2014
  • By David Wilcox

Volkswagen wants to ramp up cost-cutting synergies between its two European truck brands, MAN and Scania, by going from what it calls “arms-length co-operation” to extensive sharing of major components.

VW currently holds 62.6% of Scania’s share capital and last week announced an offer to buy the remainder held by minority shareholders in order to push ahead with integration plans. The European Commission merger authorities paved the way for integrating the two truck businesses back in September 2011 when it approved VW’s ownership of a controlling stake in MAN, but since then any synergies appear to have been restricted to behind-the-scenes activities such as purchasing. Analysts say VW has been slow to capitalise on its position.

Now VW spells out that it wants Scania and MAN to share gearboxes and axles and to adopt what it describes as “joint modular architecture” for cabs, engines and electrics. Key components like fuel-injection systems and turbochargers would be shared. VW believes that it can still maintain distinct brand identities for MAN and Scania, as it does with its car brands.

“The full benefits can start to be realised once Volkswagen holds 100% of the shares in Scania,” said VW last week, announcing its offer to buy the remaining shares at a premium of over 50% more than their average price during the last three months. Shareholders have from 17 March until 25 April to sell their holdings; VW says the transactions are subject to it getting sufficient shares to increase its stake in Scania to at least 90%.

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Article source: http://www.commercialmotor.com:80/latest-news/man-and-scania-mania