Daimler Plans to Make Truck and Bus Business a Separate Entity
FEB 4, 2021 - 6:57 am
The supervisory board and the board of management of Daimler has agreed to evaluate a spin-off of its truck and bus business and begin preparations for a separate listing of Daimler Truck. It is intended that a significant majority stake in Daimler Truck will be distributed to Daimler shareholders. The Daimler Truck business will have fully independent management and stand-alone corporate governance, including an independent chairman of the supervisory board. Daimler Truck also is aiming to qualify as a DAX company. The transaction and the listing of Daimler Truck on the Frankfurt stock exchange is expected to be complete before the end of 2021. In addition, it is also Daimler’s intention to rename itself Mercedes-Benz at the appropriate time.
“This is a historic moment for Daimler. It represents the start of a profound reshaping of the company. Mercedes-Benz Cars & Vans and Daimler Trucks & Buses are different businesses with specific customer groups, technology paths and capital needs,” Ola Källenius, chairman of the board of management of Daimler and Mercedes-Benz, said. “Mercedes-Benz is the world’s most valuable luxury car brand, offering the most desirable cars to discerning customers. Daimler Truck supplies industry-leading transportation solutions and services to customers. Both companies operate in industries that are facing major technological and structural changes. Given this context, we believe they will be able to operate most effectively as independent entities, equipped with strong net liquidity and free from the constraints of a conglomerate structure.”
As part of the new structure, both Mercedes-Benz and Daimler Truck will be supported by dedicated captive financial and mobility service entities, driving sales with financing, leasing and mobility solutions. In this process, the company plans to assign resources and teams from Daimler Mobility to both Mercedes-Benz and Daimler Truck.
“We have confidence in the financial and operational strength of our two vehicle divisions. And we are convinced that independent management and governance will allow them to operate even faster, invest more ambitiously, target growth and cooperation, and thus be significantly more agile and competitive,” Källenius said.
Daimler Truck intends to generate value for its shareholders by accelerating the execution of its strategic plans, raising its profitability and driving forward with its development of emissions-free technologies for trucks and buses.
“This is a pivotal moment for Daimler Truck. With independence comes greater opportunity, greater visibility and transparency,” Martin Daum, member of the board of management of Daimler and chairman of the board of management of Daimler Truck, said. “We will grow further and continue our leadership in alternative powertrains and automation. We have already defined the future of our business with battery-electric and fuel-cell trucks, as well as strong positions in autonomous driving. With targeted partnerships, we will accelerate the development of key technologies to bring best-in-class products to our customers rapidly.
“Daimler Truck already has a solid financial basis, and our business model is robust. We will continue to work on our cash flow management and we know how to deal with industry market cycles. We have proven that again in the significant COVID-related global market reduction. We have clear strategies to raise our financial performance and accelerate our execution. We will use our strong and well-known global brands, our scale and our exceptional technology to deliver industry-leading returns.”
With more than 100,000 employees, Daimler Truck unites seven brands, including BharatBenz, Freightliner, Fuso, Mercedes-Benz, Setra, Thomas Built Buses and Western Star.
The intended structure of the transaction would involve Daimler transferring the majority of Daimler Truck to its shareholders on a pro rata basis in accordance with existing shareholdings, but Daimler intends to retain a minority shareholding. Representation of Daimler in the Daimler Truck supervisory board will be in line with the intended deconsolidation.
This announcement marks the beginning of the process to finalize the planned transaction. All further details of the intended spin-off will be presented to shareholders at an extraordinary shareholder meeting in Q3/21 in order to obtain mandatory approval of the plan.
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