Volvo to raise stake in Nissan

Volvo AB, Europe's second-largest truck maker will spend about 500 million Swedish kronor (US$69 million; €53.83 million) to buy its remaining 6 percent stake in truck maker Nissan Diesel Motor Co. so that it can extend its reach into growing Asian markets.

“The acquisition will help to increase Volvo's presence in Asia.” said Jose Asumendi, an analyst with WestLB in Dusseldorf, Germany. The Swedish truck maker said that the deal give it a wider geographical reach in Asia and also help balance the company's offerings of heavy trucks.

Volvo became Nissan Diesel's top shareholder in March when it bought a 13 percent stake from Nissan Motor. The truckmaker said at the time that it had a four-year option to buy the remaining 6 percent stake held by Tokyo-based Nissan Motor, Japan's second-biggest carmaker. Volvo will eventually own 46.5 percent of Nissan Diesel, Japan's fourth-largest truck maker.

Chief Executive Officer Leif Johansson said hat the two companies plan to cooperate on research projects and purchasing. “What we are doing here is progressing according to plan,'' Johansson said.

Nissan is trying to focus on its passenger and light commercial vehicle businesses and the company President and Chief Executive Officer Carlos Ghosn says that the sale was a part of Nissan’s strategy to concentrate on light vehicles.

"We firmly believe that Volvo is the best partner for Nissan Diesel," Ghosn said. "During the past four years, Nissan Diesel has seen a turnaround in its business performance to become a valuable company."

Nissan Diesel shares went up 5.66 percent to 466 yen (US$4.00), while Nissan finished up 0.45 percent at 1,320 yen (US$11.34) at the Tokyo Stock Exchange on Monday.