MAN CEO won't rule out breaking up conglomerate

MUNICH -- German industrial conglomerate MAN AG no longer rules out a breakup of its corporate structure and sale of its non-truckmaking businesses to help seal an acquisition of Swedish truckmaker Scania, MAN said.

"We don't have a problem with the current structure, but we also do not have any dogmas," Chief Executive Hakan Samuelsson told reporters on Wednesday in comments embargoed for today.

The remarks could help facilitate MAN's 10.3 billion euro ($13.59 billion) takeover bid for Scania if Samuelsson in fact focuses MAN on its core commercial vehicles business and so calms Scania's objections to linking up with a sprawling conglomerate.

The Swede, a former top executive at Scania, already broke with tradition by selling off this year a majority in the group's printing machine division MAN Roland. He plans to divest its remaining 35 percent in MAN Roland via an initial public offering in a few years.

Scania CEO Leif Ostling, an impassioned opponent to a merger with the German truckmaker run by his former subordinate, has repeatedly stressed that one of the drawbacks to the proposed deal was becoming a part of a conglomerate.

Scania is not only a pure-play trucks and buses manufacturer, but also has focused its business on building heavy trucks with gross vehicle weights starting at 16 tons.

MAN also builds huge two-stroke diesel engines used in ships and turbines for power plants. It operates Ferrostaal as well, a division that trades in steel for example and is widely seen as a conglomerate within a conglomerate.

During the news briefing, MAN management also added that it expects to hit its group operating profit target of 1 billion euros this year and forecast continued robust demand for trucks come next year with rising vehicles sales.

Analysts and investors had worried that the compulsory introduction of digital tachographs as well as tougher emissions standards earlier this year would artificially drive demand to a peak due to a pull forward in demand.

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