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Volvo offers to take over Nissan Diesel Motor Company

Volvo offers to take over Nissan Diesel Motor Company
AP
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First Published: Tue, Feb 20 2007. 05 53 AM IST
Updated: Tue, Feb 20 2007. 05 53 AM IST
Stockholm, Sweden: AB Volvo on Tuesday made a 7.5 billion kronor (Rs4,683 crore) offer to take over Japan’s Nissan Diesel Motor Co. in which the Swedish company already owns 19%.
“With Volvo as owner, Nissan Diesel gains the resources and the financial stability needed to fully capitalize on the opportunities that a closer cooperation offers to both parties,” Volvo Chief Executive Leif Johansson said in a statement.
The 540 yen (Rs198.50) cash per share offer represented a premium of 32 % based on Nissan Diesel’s average share price during the past three months, Volvo said.
If approved by anti-trust authorities, the deal would be completed by March 29, Volvo said.
Volvo, the world’s second-largest truck maker after DaimlerChrysler AG, bought a 13 percent stake in Nissan Diesel in March 2006 from Tokyo-based Nissan Motor Co., and upped its holding to 19 % in September.
Volvo said a joint study identified synergy gains amounting to $263 million annually, mainly as a result of increased purchasing volumes, but also from product development and access to each other’s dealerships and service networks.
“During our joint synergy study, great trust grew between the companies and I believe that the merger is the best alternative for Nissan Diesel’s future,” Nissan Diesel President Iwao Nakamura said in the statement.
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First Published: Tue, Feb 20 2007. 05 53 AM IST
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