Sweden's AB Volvo will clear the last hurdle to acquiring French truck maker Renault V.I. (RVI) and its U.S. subsidiary, Mack Trucks, once approval is granted by U.S. District Court.
At presstime, Volvo and RVI's parent, Renault SA, expected to conclude the transaction by the end of December.
However, one condition remains. U.S. approval is contingent on Volvo Trucks North America divesting its low-cabover-engine (LCOE) truck business. AB Volvo has agreed to do this within three months.
That shouldn't be too painful a task. According to Volvo, the LCOE segment amounts to less than 3% of the total heavy truck market in North America. The OEM points out that in 1999 it delivered only some 2,100 of these vocational trucks. It says the divestment will involve its Xpeditor LCOE models but neither the Volvo trademark nor any assembly plants will be affected.
With the purchase behind it, AB Volvo is establishing a new business unit dubbed Volvo Global Trucks that will house the Volvo, Renault, and Mack brands. Tryggve Sthen, currently CEO of Volvo Trucks (Sweden) has been named CEO of the new operation. The OEM says Volvo Global Trucks will represents 70% of Volvo's worldwide sales.
“I am very pleased with this decision,” says Leif Johansson, Volvo president & CEO. “It means that after the closing, we can immediately start the integration process. We are very eager to quickly implement the strategy for the new truck group and the merged powertrain units. Our intentions are to have a functional management and organization in place by early next year.”