Bumper pay rise for Scania boss

The president and CEO of Swedish truck giant Scania has been awarded a massive pay rise and an extended contract in the wake of increased income for the company in the first half of the year.

Leif Östling, 59, will receive a fixed annual salary of 7.5 million kronor – an increase of 33% on his previous wages. His contract with the company has been extended to the end of March 2009 and includes an annual pension provision of 4.4 million kronor.

In a press release, the company said the new contract “will secure stability and continuity for Scania, to the benefit of all shareholders”.

The company also announced a 16% increase in both operating income and net income, to 3.5 billion kronor and 2.3 billion kronor respectively, for the first half of 2005.

“Despite uncertain economic development in western Europe, our main market, order bookings for vehicles were largely unchanged,” said Leif Östling.

The company announced earnings per share of 11.58 kronor.


Volkswagen gets shares to take over Scania

Volkswagen, Europe's biggest carmaker, was set to take full control of Swedish truck manufacturer Scania on Tuesday after a small but crucial shareholder agreed to sell its shares.

Volkswagen gets shares to take over Scania
Swedish pension fund Alecta previously held out for a higher share price but agreed to sell its 2.04-percent stake in Scania, paving the way for Volkswagen to acquire full control the company.
On April 30, the German car giant said it lacked less than two percent more shares to reach its 90 percent goal, and thereby force the sale of the remaining shares.
"After new discussions with Volkswagen we have concluded that there will be no increase in their offer," Alecta said in a statement, referring to Volkswagen's refusal to pay more than 200 kronor ($30.5) per share.
In February, Volkswagen offered €6.7 billion ($9.3 billion) to acquire the nearly 40 percent of Scania it did not already own and to strengthen its position against its German competitors Daimler and the Swedish truck maker Volvo.
Scania's board of directors recommended shareholders not to part with shares at the price offered.
The offer expired on April 25th. However, confident that shareholders could be won over, Volkswagen extended its offer to May 16.
The German auto giant already owns truck and bus-maker MAN and bought into Scania in 2000.
It had previously said that it could make annual savings of €650 million through economies of scale by taking full control of the Swedish company.
The takeover is just the latest to hit Sweden's beleaguered vehicle manufacturing sector which has seen Chinese takeovers of the once iconic car brands Saab and Volvo.
Volvo Trucks announced more than 4,000 job cuts over the last six months and a voluntary redundancy scheme aimed to cut costs and increase profitability.