Swedish buffer fund AP4 has joined a list of institutional investors rejecting Volkswagen’s offer for truck manufacturer Scania.

AP4 said it was following the recommendation of the independent board committee at Scania, which advised investors to reject the SEK200 (€22.30) per share offer, as it did not reflect the long-term fundamental value of the firm.

The fund currently owns around 0.65% of the firm, compared to VW’s 62.6% holding.

Scania has been embroiled in a controversial battle between VW and its remaining shareholders for some time.

The German automotive group also owns MAN, a rival truck manufacturer to Scania, and has steadily increased its holding in the Swedish firm looking to complete a merger of the two.

After its final move to acquire complete control, Scania’s independent committee provided its verdict which rejected any takeover offer valued at SEK200.

This led fellow institutional shareholders, Swedish pension provider AMF, which owns around 0.8% of Scania, and asset manager Skandia, to turn down the offer.

In a statement, AP4 said it fully backed the committee’s findings.

“AP4 is fully aware that there is a risk that the Scania share price may fall in the short term if the offer is withdrawn by Volkswagen.

“Our belief is however that the Swedish senior citizens who are the main principals of AP4, in the long term will benefit if Scania remains as an independent listed company.”

When it rejected the offer, AMF said that VW’s lack of focus on long-term potential was counter to its mission as a long-term investor.

“Our conclusion is based on both external and internal analysis. Particular emphasis has been placed on the independent committee’s recommendation because of their deeper insight in Scania and the company’s business plan,” said Anders Oscarsson, AMF’s head of corporate governance.

“We are well aware of the risk of a short-term stock market reaction if the bid as a whole is not accepted, but our view is that the offer of SEK200 do not meet the company’s long-term value.”

Skandia echoed these sentiments, suggesting the committee’s conclusion was in line with its own house view.

The rejection is an issue in a long line of clashes between VW and Scania’s smaller shareholders.

In February, the trio of institutional investors and Swedbank Robur took steps against the German manufacturer after it shut out minority shareholders.

The group claimed the VW was using its influence, and 88% voting right, to reduce shareholder rights and take control of the board.