Alecta, the Swedish occupational pensions manager, has joined fellow institutional investors in Scania in rejecting VW’s proposed takeover of the automotive manufacturer.

The manager, and the third largest shareholder in Scania, said it rejected the offer after its own internal analysis.

VW, currently the largest shareholder in Scania, has been looking to takeover the Swedish outfit and merge it with rival German truck manufacturer MAN.

However, its offer of SEK200 (€22.30) per share was met by dismay from fellow shareholders and Scania’s independent committee, which called for a full-blown rejection of VW’s valuation, as it failed to take into account long-term prospects.

Ramsay Brufer, Alecta’s shareholder representative, said the decision to reject the offer was based on the conclusions of internal analysis and the independent committee’s findings.

“The offer does not fully reflect Scania’s long-term fundamental value,” Brufer said.

“The decision has not been easy, but, in the longer term, this is what best serves the interests of our clients.”

Alecta’s decisions matches that of Swedish buffer fund AP4 and fellow Swedish institutions AMF and Skandia.

AP4, whose shareholding equates to around 0.65%, also said it was following the recommendations of the independent board, a stance echoed by AMF and Skandia.

At the time, the buffer fund said it was willing to suffer short-term falls in Scania’s value under the belief Swedish citizens would benefit if the company remained independent and listed.

The trio, alongside Swedbank Robur, have long clashed with VW over its ownership of Scania, its influence on the board and its 89% voting power, via preference shares, despite only owning 62.6% of the capital structure.

VW first invested in Scania in 2000 and steadily increased its holdings, eventually looking to merge the firm with MAN to achieve cost efficiency.

However, it was VW’s ownership of MAN which highlighted potential governance concerns at Scania, after the Swedish manufacturer unexpectedly pulled out of a lucrative contract only for it to be awarded to MAN.