UPDATED: Navistar International Corp. and Traton have reached an agreement for Traton to buy out the remaining shares in Navistar.

The news from Traton comes just hours after an announcement from Navistar indicating that the two companies looked like they finally might have a deal for the acquisition of Navistar International Corp. by Volkswagen’s truck and bus unit for $3.69 billion.

Following discussions between Navistar and Traton, Navistar's board of directors confirmed Friday morning on Oct. 16 that it would be prepared to move forward with a transaction in which Traton would acquire Navistar for $44.50 per share in cash. Navistar's board confirmed that an offer of $44.50 per share has the support of Navistar's two largest shareholders, Icahn and MHR.

In an Oct. 16 letter to Traton, Navistar's board asked Traton to confirm that a price of $44.50 per share is a basis for finalization of definitive agreements and asked that Traton promptly make a public announcement of an extension of its previously announced expiration of its offer to acquire Navistar.

An announcement from Traton midday confirmed it.

"We are pleased to have reached agreement in principle for a transaction after intensive negotiations with Navistar. We are looking forward to completing our due diligence and obtaining the necessary approvals in respect of this exciting deal in order to welcome the new Traton family member," said Matthias Gründler, CEO of Traton SE, in a news release.

This agreement in principle remains subject to finalization of due diligence to the satisfaction of Traton, agreeing on the conclusion of a merger agreement and related transaction documents, and the approval of the transaction by the executive bodies and committees of Traton and parent company Volkswagen AG, as well as by Navistar's board of directors and shareholders.

Navistar shares surged by as much as 21% to nearly $43 shortly after the open of regular trading, according to Bloomberg, after dropping earlier this week following Traton’s surprise “take it or leave it” letter.

On Oct. 14, Traton said its September 10 offer of $43 per share in cash for all outstanding shares of common stock of Navistar not already owned by Traton would expire if not accepted by Friday, Oct. 16, at 6 p.m. Central European Time – that’s noon Eastern Daylight Time in the U.S.

On Jan. 30, Traton submitted a proposal to acquire all outstanding shares of common stock of Navistar at a price of $35 per share, in cash. It increased that on Sept. 10 to $43 per share.

In 2016, then-Volkswagen Truck & Bus took a 16.6% equity stake in Navistar International Corp. as part of a “wide-ranging strategic alliance." Traton's truck brands include MAN, Scania, and Volkswagen Caminhões e Ônibus. Both Traton and Navistar have taken minority stakes in autonomous-truck-technology developer TuSimple.

Bloomberg also noted that boosting the value of VW’s trucks unit has been a major priority for CEO Herbert Diess, who talked about the importance of acquiring Navistar in his address to shareholders at VW’s annual general meeting last month. Traton is also in the midst of a major restructuring of its MAN unit.

Updated Friday, Oct. 16, 2020, at 4:40 p.m. EDT.