Volkswagen AG's Traton SE has agreed to take full ownership of the rest of Navistar International Corp. to the tune of $3.7 billion, enabling the company to get long-sought access to North American clients.

The deal is valued at $44.50 a share and covers all except the nearly 17 percent of Navistar that Traton already controls. It is subject to final evaluation and approval from both companies' boards.

If the deal proves successful, it would see the consolidation of Scania, MAN, and VW truck brands with Navistar to form a global manufacturing entity, at a time when the most of the industry is searching for solutions to share the costs of making low- emission technology.

The Munich-based Traton acquired its preliminary stake in Navistar in September 2016, setting the stage for a North American market presence. On Jan. 30 this year, Traton offered to procure the rest of Navistar for $35 a share, or nearly $3 billion.

Navistar earlier disclosed the transaction is backed by Carl Icahn, its biggest shareholder, and MHR Fund Management, the hedge fund established by Mark Rachesky. Traton had difficulties winning over tycoon activist investor Icahn, whose fund owned a 17 percent share in the U.S. truck builder as of June 30, Refinitiv Eikon Data showed.

Traton called the $43-per-share bid its "best and final" price earlier in the week, which is set to expire Friday. With word of a preliminary deal, Navistar share prices climbed almost 24 percent during Friday's close at $43.52.

At present, the Volkswagen AG subsidiary has no direct access to North America's market, the industry's most important source of revenues, and instead depends on sales in Latin America and Europe.

Traton makes light-duty commercial vehicles, trucks, and buses at 29 assembly sites in 17 nations. It sold approximately 242,000 vehicles last year.

Strengthening the value of Volkswagen's trucks division has been a strong focus for Chief Executive Officer Herbert Diess. Traton is currently undergoing a major reorganization of its MAN unit, and Diess cited the significance of buying Navistar in during his address to stakeholders at the company's yearly general meeting in September.

The deal with Traton would mark a new period for Navistar, which has come a long way since Cyrus McCormick developed the mechanical Reaper in 1831. Navistar had around 13,300 staff around the world as of late 2019. Traton disclosed employing 82,700 personnel globally.

According to Traton Chief Executive Officer Matthias Grundler, they are very happy to have "reached an agreement in principle for a transaction after intensive negotiations with Navistar," the Chicago Sun Times quoted the CEO as saying.