Friendly Scania-MAN Merger Said Possible

Swedish investment group Investor AB said Thursday that a friendly merger between truckmakers Scania AB and MAN AG "is not a necessity but a possibility," as it presented its fourth-quarter earnings report.

Investor, Scania's second-biggest shareholder, has rejected MAN's hostile bid for Scania, and recent market speculation has focused on a friendly co-operation between the Swedish and German rivals. Investor said it can "see long-term industrial merits in combining Scania's and MAN's businesses, given that the execution is handled in the right way."

"If a solution is to be found, it has to be done in a non-hostile environment," the company said in its earnings statement. "We will continue to support Scania's successful development as a standalone company, but we will naturally evaluate possible industrial partnerships and combinations in order to develop Scania further."

Investor, which is run by Sweden's powerful Wallenberg family, said its net profit fell 14% in the fourth quarter, to 10.58 billion kronor (1.17 billion euro; $1.5 billion), or 13.79 kronor (1.52 euro;$1.97) per share, from 12.3 billion kronor, or 16.03 kronor per share, for the same period in 2005.

However, the company said its net asset value per share jumped 19% to 208 kronor (23 euros; $29.70), from 175 kronor in the previous year, thanks to strong gains in its core holding.

Investor shares were up 0.3% at 170 kronor (18.76 euros; $24.20) in Stockholm trading, while Scania shares were down 1.8% at 455.50 kronor (50.27 euros;$64.96).

The Wallenberg family, since the creation of Investor in 1916, has controlled large parts of Sweden's industry, including stakes in LM Ericsson, engineering company ABB, Electrolux AB and defense technology company Saab AB.