DaimlerChrysler currently owns 21.3%; the company plans to buy the rest at $23 per share, a total of approximately $423 million. The transaction is expected to be completed by this fall.
Penske Corp., Detroit Diesel's major shareholder, owns 48.6% of the outstanding shares, and has agreed to tender its shares in the offer. The acquisition includes all on-highway, off-highway, automotive and parts and remanufacturing activities of DDC.
According to Roger S. Penske, DDC, chairman, “This transaction is an important step in the continued growth of DDC. As we look at the competitive environment, and the consolidation activity occurring within our industry, this merger will provide strength and stability for DDC in the future.”
Dieter Zetsche, board member responsible for commercial vehicles at DaimlerChrysler, noted that “in the worldwide truck market, the engine is one of the most important competitive elements in terms of customers' economic requirements as well as to meet emission standards. Therefore, this step continues DaimlerChrysler's strategy of building its worldwide leadership in diesel engines and enables us to offer an integrated truck product in every major market across the globe.”
The acquisition makes DaimlerChrysler the top manufacturer of heavy and medium duty on-highway diesel engines in the world, according to DaimlerChrysler Chairman Juergen Schrempp.