Scania Rejects Cooperation With Volvo

After repeatedly being rebuffed in attempts to take over rival Swedish truck maker Scania AB, Volvo tried a different approach last week, proposing to work with its competitor.

But Scania balked again at an alliance with Volvo, saying it had no interest in cooperating with the larger truck manufacturer.

Louise Jarn Melander, director of corporate communications for Scania, said "nothing new" was in the Volvo proposal that her company rejected.

"We are certain that cooperation between Scania and Volvo would damage our ability to continue to grow," she said May 6.

"Volvo's ambition has been to effect a merger with Scania and is well known," said Leif Johansson, chief executive officer at Volvo.

"However, we have not been able to reach an agreement with Scania's principal owner, Investor, with respect to a valuation of the company. We think cooperation is a good alternative, especially now when it has not been possible to reach an agreement," he said during a May 6 press conference at his company's headquarters in Gothenburg, Sweden.

Johansson said a long-term cooperation pact with Scania could save the companies more than $100 million over three years.

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