VW denies rumors of planned takeover bid for U.S. truckmaker Paccar

FRANKFURT -- Volkswagen Group says it is not interested in bidding for U.S. truckmaker Paccar, rejecting comments made by Daimler's commercial vehicle chief Wolfgang Bernhard.

Analysts have long predicted VW would seek to enter the world's biggest trucks market, either via an acquisition of Paccar or of troubled U.S. rival Navistar International, to take on global trucks leaders Daimler and Volvo.

According to a Bernstein Research note published today, Bernhard said that "serious, multiple sources" informed him that VW plans to bid for Paccar next year. Bernhard was briefing analysts at an event in Berlin on Wednesday hosted by Daimler Trucks.

A VW spokesman emphatically denied the rumors, calling them "complete rubbish."

Daimler said today that Bernhard had been asked about consolidation among truck manufacturers at the event. Bernhard answered that VW’s interest in Paccar was a widely discussed topic in the industry, according to Florian Martens, a Daimler spokesman.

VW Group sold 2 billion euros ($2.7 billion) in preferred stock a month ago to help fund the takeover of truck producer Scania. VW is integrating the Swedish manufacturer with its own commercial-vehicle operations and MAN, which VW also controls, to create a truck division to compete with Daimler, the industry leader.

With Scania and MAN focused on Europe, VW lacks a presence in the North American truck market. Paccar builds Kenworth and Peterbilt trucks in the United States, as well as DAF vehicles in Europe, and has a market value of $22.6 billion.

Bernstein Research analyst Max Warburton said a VW bid for Paccar "would not be a ridiculous move, given the company's truck operations currently are all non-NAFTA. But a deal would be expensive, require a capital raise and may upset investors."

Regulatory hurdle

Arndt Ellinghorst, an analyst at ISI Group in London, said in a report that it was unlikely VW would be able to keep Paccar's European operations because of competition legislation. He said CNH Industrial, the maker of Iveco trucks, is viewed as a potential suitor for DAF, which may cost about $2.5 billion to buy.

VW has far reaped limited financial rewards for the billions of euros invested in purchasing majority stakes in Scania and MAN as minority investors resisted efforts to share technology that would boost combined profit.

VW CEO Martin Winterkorn told the company's March 13 annual press conference that VW has no plans at present to expand the group through further acquisitions as it is focusing on integrating its 12-brand network.

VW has achieved only 200 million euros in savings from joint work among its commercial vehicle operations. Its goal is to deepen cooperation among the businesses to reach annual operating- profit synergies of 650 million euros.

Bernhard was an executive at VW before being pushed aside in 2007 after Winterkorn took charge. Andreas Renschler, who was head of Daimler's trucks unit prior to Bernhard, will oversee VW's commercial vehicle operations starting next year after deciding to leave Daimler following a job switch with Bernhard.

Bloomberg and Reuters contributed to this report

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