Calling Off Volvo-Scania Marriage May Attract Suitors
Volvo refused to offer further concessions to European Union officials who have indicated they will bar the Swedish truck maker from taking over its rival Scania.
Volvo’s action all but ensures the bloc’s competition commission will recommend rejecting the merger. The full EU executive committee must then approve the decision.
Analysts say this situation creates conditions sure to produce more consolidation among truck makers worldwide and could open the door for deals with U.S. manufacturers.
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If the deal is denied, it will leave Scania ripe for another suitor or perhaps a takeover bid of its own. Volvo AB, the world’s second largest heavy-duty truck maker, will be left with the $5.8 billion in cash it made from selling its car division to Ford Motor Co. in March 1999.
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