The German automaker made a $35 per share offer in January to try to increase its stake in Navistar beyond the 16.6% it bought in 2016, but failed to secure a majority stake. Analysts at Jefferies have said Navistar is worth at least $45 a share.
Volkswagen said Traton’s new offer valued the shares in Navistar it doesn’t already own at around $3.6 billion.
“We believe it’s in Traton’s interest to move quickly on NAV (Navistar) as NAFTA truck market recovers,” Jefferies said in a note on Thursday, referring to North American markets.
Navistar said it would review the revised offer.
“Navistar’s Board of Directors and management team are committed to exploring all avenues to maximize value. Consistent with its fiduciary duties, the Board will carefully review the revised proposal from Traton,” Navistar said.
Like the auto industry, the truck sector faces pressure to consolidate to share the costs of developing low emission technologies. Traton and Navistar have been collaborating on purchasing and electric vehicle technology.
But Traton has struggled to win over Navistar’s largest shareholder, financier Carl Icahn, whose fund controls 16.9% of Navistar’s shares. Icahn and two other activist funds, Mark Rachesky’s MHR Fund Management and Gabelli Funds, together own 40% of Navistar’s shares, according to Refinitiv data.
Volkswagen said on Thursday it would provide funds to finance Traton’s increased offer with the aim of Traton becoming the sole owner of Navistar.