Volvo hikes Nissan Diesel stake by 33.5%

STOCKHOLM/TOKYO: Swedish truckmaker Volvo said on Monday it would pay 4bn crowns ($553m) to hike its stake in Nissan Diesel Motor Co by 33.5% to 46.5%, boosting its Asian business.

Volvo, the world’s number two truckmaker, is under pressure from activist shareholder Cevian to increase shareholder returns. Volvo wants to complete acquisitions before raising payouts. The latest Nissan Diesel acquisition is part of that strategy.

Volvo said it was buying the remaining 6% in Nissan Diesel — the smallest of Japan’s four truckmakers — owned by Nissan Motor for 500m crowns.

It was also acquiring preference shares, to be converted into ordinary stock in stages between ’08 and ’14, owned by Nissan Motor and banks, for 3.5bn crowns.

“Combined, these lots correspond to 46.5% of the shares in Nissan Diesel,” Sweden-based Volvo said. Ownership would be at 41.9% by April 1, ’08, it added.

Faced with maturing markets at home, truckmakers in Europe and Japan have been seeking growth in Asia, forming both operational and capital partnerships with each other.