VOLVO INCREASES ITS PROCORDIA SHAREHOLDING -- SELL-OFF BY SWEDISH GOVERNMENT; NEGOTIATIONS BETWEEN GOVERNMENT AND VOLVO CONCLUDED
VOLVO INCREASES ITS PROCORDIA SHAREHOLDING -- SELL-OFF BY SWEDISH
GOVERNMENT; NEGOTIATIONS BETWEEN GOVERNMENT AND VOLVO CONCLUDED
NEW YORK, May 4 /PRNewswire/ -- Volvo and the Swedish government today reached agreement on a new accord regarding shares in Procordia.
The agreement involves an exchange of shares whereby the government will transfer Procordia series A shares to Volvo -- in return for an equal number of B shares, plus cash for any price difference -- in an amount that Volvo thereafter holds 45 percent of voting rights represented by all Procordia shares outstanding. Accordingly, the Swedish government's voting rights are reduced to 40.4 percent.
The agreement also signals the government's plan to divest its entire Procordia holding as soon as possible. The intention is that the sale shall be made in such a manner that the shares become available to a very large number of buyers of all categories in Sweden and abroad. Volvo has agreed to support this sale, which will be implemented after coordination with Procordia as well as Volvo.
If agreement is reached with a buyer, or a buyer group acting in unison, to purchase a block of shares exceeding 5 percent of the total, despite attempts to direct the share offering to a large number of buyers, Volvo shall have the right of first refusal before the sale can be implemented.
Should Volvo's right of first refusal result in the acquisition of more than 20 percent of voting rights, Volvo will then tender a public offer to acquire all shares in Procordia.
This agreement also means that Procordia's board of directors has decided to withdraw its bid regarding Volvo. There is no plan for Volvo to initiate a new offer from Procordia to Volvo's shareholders. Volvo views itself as a long-term, industrial owner in Procordia and intends to actively pursue a positive development for the company and its shareholders.
At the next annual general meeting of Procordia, the government is entitled to appoint four board members, of which two shall be vice chairmen. As long as the government holds at least 25 percent of voting rights, this right of appointment is retained. If voting rights fall below 25 percent but are above 10 percent, the government is entitled to appoint one board member.
Volvo is entitled to appoint four board members at the next annual general meeting, of which one shall be chairman. Volvo will nominate as chairman Procordia's current president and CEO, Soren Gyll, who will assume the post of president and CEO of Volvo on May 13.
As long as the government holds at least 25 percent of the voting rights in Procordia, the articles of association and share capital can be changed only if the government and Volvo are in agreement.
/CONTACT: Thomas Clifford of Volvo North America, 212-418-7431/
(VOLVY) CO: Volvo North America Corporation; Procordia ST: New York IN: AUT SU:
TQ-OS -- NY092 -- 6196 05/04/92 16:26 EDT