After Mitsubishi deal, where will Volvo turn next?

STOCKHOLM, Sweden (Oct 18, 1999) Ð Following its alliance with Mitsubishi Motors earlier this month, Volvo AB will next look to North America for an acquisition target, a Swedish newspaper said on Saturday.

On Oct. 8, Volvo and Mitsubishi said Mitsubishi would spin off its truck business into a separate unit and sell a 19.9% stake to Volvo. Volvo also will buy 5% of Mitsubishi for $270 million. Mitsubishi will buy up to 5% of Volvo by the end of 2002.

The two companies already have close ties. They have also been studying the possibility of developing medium-sized trucks together as well as of using Volvo parts in Mitsubishi large trucks. The Mitsubishi Canter, a small truck, has been sold through Volvo outlets in Europe.

“The pieces of the puzzle are in place in three parts of the world. One part of the world is missing: North America,” Volvo spokesman Stefan Lorentzson was quoted as telling financial daily Finanstidningen.

VolvoÕs class-8 market share in the United States is 11%, off slightly from last year. In Canada, the companyÕs share is 14%. Possible targets include Navistar International and Mack Trucks, a subsidiary of Renault.


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