#Volkswagen nearing a deal with Carl Icahn to buy Navistar

Volkswagen has been locked in a staring contest with Carl Icahn — and the billionaire is blinking.

Navistar — the maker of the International brand of big-rig trucks whose big shareholders include Icahn and his former protégé Mark Rachesky — reached a deal in principle Friday to sell itself to Volkswagen’s truck-making subsidiary Traton for $44.50 a share, which values the company at about $3.7 billion.

That’s up slightly from the $43 a share that Traton offered last month after it sweetened an earlier bid for $35 a share. But the $44.50-a-share offer is well short of the $50 a share that Icahn wanted, according to sources close to the talks. Rachesky, as The Post has previously reported, had once been seeking significantly more.

The haggling came to a head this week when Traton sent a letter to Navistar saying its $43-a-share offer represented its “best and final.”

Traton, a large Navistar investor that controls two board seats, said it would walk off the lot at 6 p.m. Friday unless Navistar agreed in writing to proceed with a deal at that price.

Traton’s hard-knuckle announcement sent Navistar’s shares tumbling 20 percent on Wednesday, bringing ­Icahn and Rachesky to their knees.

Navistar and Traton on Friday said Traton will buy the Navistar stock it doesn’t already own for $44.50 a share, subject to due diligence and final approval from both the board and shareholders. Navistar’s shares closed up 22.8 percent, or $8.10 a share, to $43.52.

The handshake agreement ends four years of on-and-off talks between the two truck makers. Volkswagen’s Traton is seen as the only natural buyer for Navistar because it is the only leading global truck maker that does not already have a US operation, which it sorely wants.

Navistar’s International line has a roughly 14 percent share of the US truck market, which will allow Traton to compete with Daimler-Chrysler’s Freightliner trucks and Volvo’s Mack trucks without the expense of building its own operations from the ground up.

Icahn and Rachesky will make money on the deal, although not nearly as much as they likely hoped when buying into Navistar shares roughly eight years ago.

Icahn bought into Navistar in 2011 when its stock was around $35 a share, and Rachesky in 2012 when the shares were in the mid-20s.

Since Sept. 2011, when ­Icahn announced he had been buying Navistar shares, the stock has risen 28 percent. The S&P 500 in that same time period is up 179 percent.

Icahn’s other auto-sector investments have done worse, including this year when his roughly $2 billion investment in Hertz went up in smoke after the car-rental company filed for bankruptcy. The pandemic crushed Hertz’s sales, leaving it unable to pay its debts.

Icahn’s 20-year investment in Federal-Mogul has also taken a hit. In 2018 the billionaire helped sell the auto-parts maker to Tenneco in a $5.4 billion deal that left him with a 15 percent stake in the parent company.