Navistar International Corp. and Volkswagen Truck & Bus have closed their wide-ranging strategic alliance, the companies announced on Wednesday.

The formation of the alliance was initially revealed in September. The closing of the deal follows receipt of regulatory approvals, finalization of agreements, and satisfaction of other customary closing conditions.

Volkswagen Truck & Bus now takes a 16.6% stake in Navistar, investing $256 million in the company and gaining the right to appoint two directors to Navistar's board.

The deal also includes framework agreements for a procurement joint venture and strategic technology and supply collaboration.

Navistar is the parent company of school and commercial bus manufacturer IC Bus as well as truck OEM International.

Troy Clarke, Navistar’s chairman, president, and CEO, said that the alliance “will create multiple benefits for both companies in both the near and long term. Now that the transaction has closed, we will move quickly to collaborate with an industry-leading strategic partner to increase our global scale, strengthen our competitiveness, and provide our customers with expanded access to cutting-edge products, technology, and services."

Global Truck & Bus Procurement LLC, the companies’ procurement joint venture, will start work immediately. It is expected to create new opportunities for quality improvement and cost reduction, enabling the companies to benefit from increased global scope and scale.

"This puts both partners in a stronger position for the future,” said Andreas Renschler, CEO of Volkswagen Truck & Bus, adding that the alliance provides his company "access to the all-important North American market.”

In line with Volkswagen Truck & Bus' ownership stake, Renschler and Matthias Gründler, chief financial officer of Volkswagen Truck & Bus, are joining Navistar's board of directors.

The joint venture is operating out of Navistar's headquarters in Lisle, Illinois. Representatives from both companies will combine the demand of five brands: Volkswagen Truck & Bus' Scania, MAN, and Volkswagen Caminhões e Ônibus along with Navistar's International and IC Bus.

The companies' ongoing technology and supply collaboration, which operates out of Stockholm, Sweden, aims to facilitate collaboration on several aspects of commercial vehicle development, including advanced powertrain technology solutions. Ultimately, it is expected to optimize research and development and expand the technology options that both companies will be able to offer customers.