Volvo Ab Class A · OMXSTO:VOLV_A
Volvo Ab Class A — AB Volvo — Merger or Acquisition (February 2007)
20 slides from Volvo Ab Class A's merger presentation, Feb 20, 2007
Slide 1: Volvo Group press conference, Stockholm
0 Volvo Group Stockholm Washington DC February 20, 2007 January 12, 2007 Leif Johansson President and CEO Leif Johansson President and CEO AB Volvo LJo 2007-02-20
Slide 2: Agenda
1 Volvo Group Agenda • Public offer to acquire 100% of Nissan Diesel • Japanese truck and bus market • Nissan Diesel company profile • Synergies and rationale • Summary AB Volvo LJo 2007-02-20
Slide 3: Public offer to acquire 100% of Nissan Diesel
2 Volvo Group Public offer to acquire 100% of Nissan Diesel • Bid price 540 JPY/share • Value of public offer about SEK 7.5 bn • Bid period 21 February – March 23 • No lower acceptance threshold for withdrawal AB Volvo LJo 2007-02-20
Slide 4: Acquisition process of Nissan Diesel
3 Volvo Group Acquisition process of Nissan Diesel Ownership Paid SEK bn JPY/share 21 Mar 2006 +13% 1.5 569 25 Sep 2006 +6% 0.5 439 +preference shares (27.5%) 3.5 341 19% (incl. preference shares 46.5%*) 5.5 390 Public Offer 20 Feb 2007 +53.5% 7.5 540 32% premium** If accepted 100% 13.0 469 14% prem
Slide 5: Truck market in Japan
4 Volvo Group Truck market in Japan Units, Thousands 120 108 100 87 83 80 62 60 64 56 57 55 49 50 46 40 36 37 20 Heavy duty: > 16 ton Medium duty: 7.5 - 16 ton 0 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06F AB Volvo LJo 2007-02-20
Slide 6: Truck market shares in Japan FY2005
5 Volvo Group Truck market shares in Japan FY2005 Medium duty Heavy duty Fuso Nissan Nissan 20% Fuso Diesel Diesel 19% 24% 15% other Isuzu 32% Isuzu 25% Hino Hino 33% 32% Nissan Diesel Nissan Diesel Condor Quon Medium duty Heavy duty AB Volvo LJo 2007-02-20
Slide 7: Nissan Diesel summary
6 Volvo Group Nissan Diesel Summary Nissan Export Motors Sold trucks FY2005 18% 18% Light duty 4,500 Medium duty 19,200 Heavy 16,500 Japan Buses 1,600 64% Sales, SEK bn 32.5 Operating profit, SEK bn 2.2 Operating margin, % 6.9 Employees 8,900 AB Volvo LJo 2007-02-20
Slide 8: Nissan Diesel main products
7 Volvo Group Nissan Diesel main products QUON CONDOR Heavy Duty Medium Duty GE13L SPACEARROW 380-450HP Coach City Bus MD 9.2L < 350 HP Light Bus AB Volvo LJo 2007-02-20
Slide 9: Nissan Diesel plants in Japan
8 Volvo Group Nissan Diesel plants in Japan Kounosu Plant Hanyuu Plant - Casting of cylinder blocks - Manufacturing of transmissions TOCHIGI and cylinder heads GUNMA - Employees: ~110 - Employees: ~200 IBARAKI SAITAMA Ageo Headquarters TOKYO KANAGAWA & Main Plant CHIBA - Engine plant - Cab plant - T
Slide 10: Nissan Diesel domestic sales network
9 Volvo Group Nissan Diesel domestic sales network 90% of sales through owned dealers ND Asahikawa ND North-east ND Hokkaidou ND Tohoku ND Iwate ND Niigata ND Hokuriku ND Gunma ND Tochigi ND Tyugoku ND Kantou ND Kyusyu ND Tokai ND Cyubu ND Kinki ND Shikoku 10 Owned Dealers with ~4,000 employees 6 In
Slide 11: Export sales 2005
10 Volvo Group Export sales 2005 ~50% of the truck volume Units Asia 9,541 Africa 4,647 North America 2,622 Units Middle East 1,572 Oceania 1,373 HD trucks 5,521 Other 491 MD trucks 10,996 LD trucks 3,729 AB Volvo LJo 2007-02-20
Slide 12: Nissan Diesel hybrid technology
11 Volvo Group Nissan Diesel hybrid technology Capacitor Hybrid CNG Bus Capacitor Hybrid Medium-Duty Truck No.1 share since 1997(40% 2005) in CNG Launched in June, 2002 powered vehicles. Achieved 50% gas mileage improvement AB Volvo LJo 2007-02-20
Slide 13: Nissan Diesel financial performance
12 Volvo Group Nissan Diesel financial performance 2005 2006 - forecast Japanese GAAP 1 Apr 05 - 31 Mar 06 1 Apr 06 - 31 Mar 07 (million) JPY SEK JPY SEK Sales 482 827 32 463 487 000 30 776 Operating income 33 454 2 249 27 000 1 706 % of sales 6,9% 6,9% 5,5% 5,5% Net income 29 089 1 956 15 500 980 T
Slide 14: Summary of the Synergies
13 Volvo Group Summary of the Synergies • Total synergies estimated to SEK 1.8 bn annually, fully implemented on a five years horizon. • Short and medium term synergies ( 2-3 years) are expected mainly for Purchasing, Distribution & Sales and partly for R & D. • More long term synergies (~5 years) a
Slide 15: Nissan Diesel will be part of one of the world's largest heavy duty truck manufacturers
14 Volvo Group Nissan Diesel will be part of one of the world’s largest manufacturers of heavy duty trucks 1,000 units Global market 2005 DCX 245 DCX • Mercedes 109 174 17 Volvo Group • Freightliner 94 Volvo/Nissan Diesel • Fuso 14 • Volvo 102 Paccar 125 PACCAR • Renault 36 • DAF/Foden 44 • Mack 36
Slide 16: Doubled size in medium-duty trucks
15 Volvo Group Doubled size in medium-duty trucks Global market 2005 1,000 units DCX 125 GM/Isuzu 90 Telco 69 Navistar 68 DongFeng 66 FAW 62 Ford 49 Hino/Toyota 49 Volvo/ Nissan Diesel 19 19 Iveco 21 Ashok 16 0 20 40 60 80 100 120 140 AB Volvo LJo 2007-02-20
Slide 17: Combined scale to meet future emission legislations globally
16 Volvo Group Combined scale to successfully meet future emission legislations globally Emission legislation Heavy-duty engines, 2005 VOLVO 182 PM (Particulate Matter) [g/kWh] Euro 2, 1996 DCX 179 0.14 0.12 US 02, 2002 CAT 158 Euro 3, 2002 0.10 Cummins 120 0.08 Weichai 114 0.06 Scania 65 0.04 57 MA
Slide 18: Integration process to deliver synergies
17 Volvo Group Integration process to deliver synergies Stand alone mode Merger mode Growth mode “Create synergies” “New architecture and shared technologies. Develop unique brand versions” Shared Shared architecture architecture and and technologies technologies AB Volvo LJo 2007-02-20
Slide 19: Acquisition rationale
18 Volvo Group Acquisition rationale • Valuable complement to Volvo’s truck business - Doubled volume in medium duty trucks • Nissan Diesel complements the Volvo Group in terms of geographical coverage and the two companies would get access to each others sales channels • Timing is important to meet
Slide 20: Jorma Halonen, EVP and Deputy CEO, Volvo Group
19 Volvo Group Jorma Halonen EVP and Deputy CEO, Volvo Group AB Volvo LJo 2007-02-20