Scania announces public offer to shareholders of Ainax

This Offer is not directed to shareholders in the United States of America, Australia, Canada or Japan or to any other person whose participation requires an additional prospectus, registration or measures other than those required by Swedish law. The press release may not be distributed or released in any country in which distribution or the Offer requires measures as stated in the preceding paragraph or is in contravention of the rules in such a country. This announcement is a translation of the Swedish announcement and in the event of any difference between the two, the Swedish announcement will prevail. The extra general meeting (EGM) of Scania AB (publ) ("Scania") today decided on a public offer to the shareholders of Ainax AB ("Ainax") to acquire all outstanding shares in the company (the "Offer") and to issue Series A shares in Scania as consideration in the Offer. The shares of Ainax are today listed on the Swedish “Nya Marknaden”. The shareholders of Ainax are offered one newly issued Series A share in Scania for each share in Ainax. The Offer is made conditional upon i.a. that it must be accepted to such an extent that Scania becomes the owner of more than 50% of the shares and votes of Ainax. The Offer will only have marginal financial effects on Scania and will not cause any dilution of earnings for Scania’s shareholders. When the transaction has been completed, Scania will withdraw the Scania shares received. The number of shares outstanding as well as the initial effects on shareholders' equity in Scania will then be re-established. The increased free float and liquidity in the Scania shares will benefit all Scania shareholders. There are several benefits for the shareholders of Ainax. Presently the liquidity of the Ainax share is very low, resulting in a discount compared with the Scania A share. The Ainax shareholders will, if the Offer is accepted, become a direct part of Scania’s regular ownership structure with voting rights at shareholder’s meetings, receive dividends directly from Scania and receive a share with much higher liquidity. An offer prospectus is expected to be made public on or about December 21, 2004. The acceptance period is expected to run from January 10 to February 15, 2005, after which payment will be received in the form of Series A shares in Scania by March 4, 2005. Background to the Offer On January 15, 1999, Volvo acquired shares representing approximately 13 percent of Scania's shares. Further acquisitions of Scania shares were made and on August 6, 1999 Volvo announced an offer to the shareholders of Scania. The merger was blocked by the European Commission, which ruled that Volvo had to divest the Scania shares held (31% of the voting rights and 46% of the outstanding capital) no later than April 23, 2004. On March 4, 2004, Volvo sold all of the B shares held in Scania. On April 16, 2004, the AGM of Volvo decided to transfer all of Volvo’s Series A shares in Scania to Ainax and distribute Ainax shares to Volvo’s shareholders. Ainax was listed on Nya Marknaden on June 8, 2004. The purpose of Ainax’s business operations is to administer the Series A shares held in Scania. In Ainax’s articles of association it is stipulated that if Ainax has not disposed all of its shares in Scania on May 1, 2008, the company shall immediately enter into liquidation. On November 1, 2004, the board of Scania proposed an EGM of Scania to decide on a public offer to the shareholders of Ainax to acquire all outstanding shares in the company. The EGM of Scania today decided on the Offer and to issue Series A shares in Scania as consideration in the Offer. The Offer from Scania The shareholders of Ainax are offered one newly issued Series A share in Scania for each share in Ainax. No brokerage commission will be payable by Ainax's shareholders accepting the Offer. On the date of announcement of the Offer, Scania does not own or in any other way control any shares in Ainax. This Offer is not directed to shareholders in the United States of America, Australia, Canada or Japan or to any other person whose participation requires an additional prospectus, registration or measures other than those required by Swedish law. Conditions of the Offer The Offer is conditional upon: 1. the Offer being accepted to such an extent that Scania becomes the owner of more than 50% of the total number of the shares and votes of Ainax; 2. all necessary permits, approvals and decisions by authorities in Sweden and abroad being obtained on terms acceptable to Scania; 3. prior to an announcement that the Offer will be completed, neither the Offer nor the acquisition of the shares in Ainax being rendered partially or wholly impossible or significantly impeded as a result of any factual or threatened legislation, court ruling, decision of a public authority or other comparable circumstances beyond Scania's control; 4. prior to an announcement that the Offer will be completed, no other party announcing an offer to acquire the shares in Ainax on terms more favourable than the Offer for the shareholders of Ainax; 5. Ainax not disposing of any shares in Scania or resolving upon a declaration of dividend, repurchase of own shares or reduction of share capital or transferring value without receiving fair market compensation; 6. Ainax not taking any action that is likely to have a negative impact on the prerequisites for the implementation of the Offer; and 7. the resolution to issue the shares in Scania to be used as consideration in the Offer being registered with the Swedish Companies Registration Office no later than by March 4, 2005. The Offer may be withdrawn with reference to the non-fulfilment of conditions 2, 3, 5, 6 or 7 above only if the non-fulfilment of any of them is of significant importance to Scania's acquisition of the shares in Ainax. Scania reserves the right to waive, in whole or in part, any or all of the conditions above. The Swedish Industry and Commerce Stock Exchange Committee's (NBK) rules regarding public offers and share acquisitions and the Securities Council's statement on interpretation and application of the rules apply to the Offer. Value of the Offer The board of Scania announced the proposed Offer that the EGM of Scania now have decided upon on November 1, 2004. In order to assess the bid premium that the Offer represents, an evaluation should be based on share prices that are unaffected by the Offer. Hence, the calculation of premium should be based on share prices before November 1, 2004. Based on the average last prices paid during the last 10 trading days before the announcement of the proposed Offer (October 18-October 29), the bid premium amounts to 1.1%. Based on the last prices paid on October 29, the last trading day before the announcement of the proposed Offer, the bid premium amounts to 1.2%. Based on the last price paid for the Series A-share of Scania on the Stockholm Exchange’s (Stockholmsbörsen) A-List on November 18, 2004, the last trading day before the announcement of the Offer, the payment is equivalent to SEK 274 per share in Ainax and a bid value of SEK 7,486 million. Preliminary timetable An offer prospectus is expected to be made public on or about December 21, 2004. The acceptance period is expected to run from January 10 to February 15, 2005, after which payment will be received in the form of Series A shares in Scania by March 4, 2005. Scania retains the right to extend the acceptance period and to delay in such case the settlement of payment. The new shares will be eligible for dividend for the financial year 2004 and give shareholders the right to participate at the Annual General Meeting in April 2005. Given that Scania completes the Offer in February, 2005, a resolution to liquidate Ainax is planned for February 2006. Scania's assessment is that a liquidation, with a distribution of Ainax's assets, will be possible to complete around July 2006. The Scania shares received by Scania from Ainax in a liquidation will then be withdrawn by Scania. Scania after the acquisition and liquidation of Ainax Financial effects of the acquisition and liquidation of Ainax An amount corresponding to the value of the newly issued shares will increase restricted equity of Scania in connection with the new issue of shares. A corresponding value less Ainax’s cash will reduce unrestricted equity pursuant to valuation rules in the Annual Accounts Act. The amount of the increase would be around SEK 7,510 million and the amount of the reduction would be around SEK 7,420 million.[1]Scania's intention is to re-establish the unrestricted equity of Scania at the Annual General Meeting of shareholders in May, 2005, by a corresponding reduction of restricted equity. The completion of the Offer will not cause any dilution of earnings for Scania’s shareholders. The reason is that Scania's share of the number of Series A shares in Scania that Ainax owns will correspond to the number of A shares in Scania issued as consideration in the Offer. Once all steps of the transaction have been completed, the number of shares outstanding as well as the initial effects on shareholders' equity in Scania will be re-established. Ownership structure in Scania before and after the Offer The tables below show the shareholder structure of Scania as of October 29, 2004 and the shareholder structure of Scania following an acquisition of Ainax based on the owner list as of the same date for Ainax and assuming that 100% of the shares of Ainax are acquired. In the latter table, the Scania shares held by Ainax have been eliminated since Ainax is assumed to become a wholly owned subsidiary. The tables are sorted by votes. SCANIA AS OF OCTOBER 29, SCANIA PROFORMA 2004 % of % of % of % of capital votes capital votes VOLKSWAGEN 18.7 34.0 VOLKSWAGEN 18.7 34.0 AG AG AINAX AB 13.7 24.8 INVESTOR AB 11.7 21.0 INVESTOR AB 9.5 17.0 WALLENBERG 5.2 9.4 FOUNDATIONS WALLENBERG 3.0 5.5 RENAULT 2.8 5.2 FOUNDATIONS S.A. ALECTA 2.3 2.6 ALECTA 2.3 2.6 NORDEA 2.9 1.2 AMF 4.0 2.0 FUNDS PENSIONSF. AB UBS AG 0.7 1.1 SEB FUNDS 2.3 1.5 LONDON BRANCH EQUITIES AMF 3.5 1.0 FJÄRDE AP- 2.9 1.5 PENSIONSF. FONDEN AB SEB FUNDS 2.0 0.9 ROBUR FUNDS 4.1 1.4 ROBUR FUNDS 3.7 0.7 NORDEA 2.9 1.2 FUNDS OTHERS 40.0 11.2 OTHERS 43.1 20.2 TOTAL 100.0 100.0 TOTAL 100.0 100.0 Note: The proforma shareholder structure is based on information from Ainax on the 10 largest shareholders, presented in the interim report of Ainax for January-September 2004. There may be other large shareholders in Scania that hold shares in Ainax. The owners have been grouped by principal in the tables and differ from the presentation in the press release as per November 1, 2004. Financial advisor Handelsbanken Capital Markets is acting as financial advisor to Scania in conjunction with its Offer to the shareholders of Ainax. If any questions please contact: · Eric Österberg, Vice President Public Relations, tel. +46 8 553 858 83 · Joanna Daugaard, Investor Relations Manager, tel. +46 8 553 837 16 · Hans-Åke Danielsson, Press Manager, tel. +46 8 553 856 62 Södertälje November 19, 2004 Scania AB Scania is one of the world's leading manufacturers of trucks and buses for heavy transport applica­tions, and of industrial and marine engines. With 29,1 00 employees and production facilities in Europe and Latin America, Scania is one of the most profitable companies in its sector. In 2003, turnover totalled SEK 50,500 million and the result after financial items was SEK 4,600 million. Scania products are marketed in about 100 countries worldwide and some 95 percent of Scania’s vehicles are sold outside Sweden. Scania press releases are available on the Internet, www.scania.com ------------------------------------------------------------------------ [1] Based on an assumed share price of Scania of SEK 275 and based on the interim report as per September 30, 2004 of Ainax. There will be a corresponding effect on the shareholders’ equity in the parent company.