Navistar Surges as VW CEO Change May Lead to Truck Unit ShakeupBy
Navistar International Corp. jumped the most this year after Volkswagen AG changed chief executive officers, a move that could portend further deal-making between the the U.S. truck manufacturer and its second-biggest shareholder.
VW’s decision to replace CEO Matthias Mueller with Herbert Diess, the head of its namesake brand, may “signal that the board is open to further change,” including an initial public offering of the company’s truck and bus division, according to Brian Sponheimer, an analyst with Gabelli & Co.
An IPO “could culminate down the line in an eventual full purchase of Navistar,” Sponheimer said in an email. He has a buy rating on the Lisle, Illinois-based company’s stock.
Navistar shares advanced as much as 8.6 percent on Tuesday, the biggest intraday gain since Dec. 19. Billionaire investor Carl Icahn and VW each hold about 17 percent stakes in the company, which limits the float, and significant short interest also contributes to the stock’s volatility, Sponheimer said.