Swedish truck maker Scania has formally rejected a
hostile takeover bid by German rival MAN, saying it raised
the prospect of extra shareholder payouts and job losses
which had rejected the bid when it was proposed in October,
formally rejected the 10.3 billion euro ($13.4 billion)
offer after MAN released its formal offer document and
prospectus last week.
"The board confirms that it continues to unanimously
recommend Scania shareholders not to accept the offer,"
it said in a statement. "The board of Scania is of
the firm view that the offer from MAN substantially undervalues
Scania," it added.
In Scania's view MAN's offer grossly undervalues the company
and the money it brings is unlikely to bring growth to
it. Investor AB, the Wallenberg family's holding company
and a major Scania shareholder with 20.1 per cent voting
rights, has also rejected MAN's offer.
In October, Scania said it would be able to make a payout
to shareholders of 35 crowns a share this year. It now
sees scope for an additional payment in 2007. Scania is
of the opinion that the company would be in the position
to distribute an additional amount of up to SEK 10 billion
($1.4 billion), including ordinary dividend, equivalent
to SEK 50 per share.
however, said despite Scania's fresh rebuttal it was continuing
talks with the Swedish firm. Investor and Scania have
said they are in contact with MAN but have offered no