RTTNews | Oct 18, 2020 12:13PM EDT

12:12 Sunday, October 18, 2020 (RTTNews.com) - Traton SE, a subsidiary of Volkswagen Group (VKW.L, VLKAF.PK, VOW.BE), said that it reached an agreement in principle to buy remainder of Navistar International Corp. (NAV) stock it does not already own for $44.50 per share.

Traton, which already holds a 16.8% stake in Navistar, said the deal is subject to finalizing its due diligence and will have to be approved by its board and Volkswagen's executive bodies, in addition to Navistar's board and shareholders.

Traton said that there is no assurance that the companies would reach agreement on definitive transaction documentation.

"We are pleased to confirm that $44.50 per share in cash for Navistar shares is an acceptable basis for finalization of definitive agreements," Traton said in a letter to Navistar.

Previously, Navistar said the transaction is supported by two largest shareholders. It also asked Traton to confirm that a price of $44.50 per share is a basis for finalization of definitive agreements.

In mid-September, Truck maker Navistar said its board concluded that the revised proposal from Traton, significantly undervalues the company and substantial synergies from a combination. However, the revised proposal of $43.00 per share represented a starting point for further exploring the possibility of a transaction.

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