Traton, Navistar said to hold last-ditch talks to save deal

Traton SE, the heavy-truck unit owned by Volkswagen AG, is holding last-minute talks with Navistar International Corp. to try and salvage a takeover deal ahead of a Friday deadline, according to people familiar with the matter.

The boards are discussing whether they can reach a compromise on price or extend the deadline for the proposed $3.6 billion deal, said the people, who asked not to be identified because talks are private. The last-ditch negotiations may not lead to any agreement, the people said.

A representative for Traton declined to comment. A representative for Navistar couldn’t be immediately reached for comment

Traton put out a surprise statement on Oct. 14 saying that its $43-a-share “best and final” offer expires at 6 p.m. Central European Time today and will be withdrawn unless it’s notified of a willingness to proceed.

Navistar shares plunged as much as 21% to $35 after the announcement, matching Traton’s initial offer made in January. The stock rose as much as 16% before the start of regular trading in New York on Friday.

While U.S.-based Navistar signaled last month it would push for a higher bid and has been seeking an offer closer to $50 a share, Traton has so far stuck to its $43 a-share-offer, the people said.

Billionaire investor Carl Icahn is Navistar’s largest shareholder with a 16.8% stake, followed by VW with a 16.7% holding. Its third-largest shareholder is MHR Fund Management, the hedge fund founded by Mark Rachesky.