Swedish heavy vehicle and equipment builder AB Volvo (OMX: VOLV B) has signed an agreement enabling it to increase its shareholding in engine manufacturer Deutz AG (FWB: DEZ). Volvo currently owns 6.7% of the share and the agreement would give the Swedish firm the opportunity to raise its stake to just over 25% in a deal worth just over 130 million Euros by buying shares at 5.88 € a piece from tractors, farm machinery and diesel engines manufacturer Same Deutz-Fahr Group corresponding to a 12% premium to three-month average share price.
Same Deutz-Fahr would be left with 8.44% of the shares and Volvo would become the largest shareholder. The transaction is subject to, among other things, an approval from relevant competition authorities. Deutz AG has supplied engines to Volvo for many years and the companies recently agreed to explore ways to extend their cooperation in medium-duty engines. The companies have also been exploring the possibility to set up a joint venture in China.
No comments:
Post a Comment