Navistar International Corp., a major assembler of commercial trucks, buses and diesel engines in North America, obtained a conditional offer from competitor PACCAR Inc. to acquire all of the Navistar assets at a substantial market premium, Stark's Truck & Off-Highway Ledger reported in today's issue of the business publication.

The respected journal also reported that Navistar then quietly turned its merger attention to competitor AB Volvo of Sweden, seeking a competing bid for all of the assets.

Spokesmen for PACCAR and Navistar repeatedly have declined to comment on reports that PACCAR was preparing a takeover bid for the Navistar assets.

Stark's Truck & Off-Highway Ledger said company sources acknowledged to it that Volvo opted not to actively pursue a bid for all of Navistar until the end of this year, when Volvo completes its pending takeover of the Renault S.A.'s commercial truckmaking unit.

Volvo obtained conditional clearance early last month from the Commission of European Union, an anti-trust regulatory agency, to proceed with its proposed takeover of Renault Vehicules Industriels and a unit, Mack Trucks Inc., in exchange for a 15% equity position in Volvo by Renault.

Mack Trucks is the third largest assembler of heavy-duty commercial trucks in the United States, Canada and Mexico. It produced 18,100 units of the vehicles during the first half of this year at two manufacturing sites in the United States.

Navistar is the second highest maker of the vehicles. It made 18,410 units of the same trucks in the United States and Canada.

The business publication reported that company sources declined to identify the value of the PACCAR offer for the Navistar assets, but noted that is was conditional on the outcome of due diligence. It said sources confirmed that 'due diligence' has not yet started.

Navistar stock closed in trading last Friday on the New York Stock Exchange at $29.94 per common share. The business journal said financial market sources placed Navistar's break-up value in the $70.00-$80.00 per share range.

Stark's Truck & Off-Highway Ledger said PACCAR's initial interest in Navistar was relegated to its commercial truck and bus assets, not its diesel engine supply operations. But PACCAR apparently changed course by offering to acquire all of the Navistar assets, it added.