This press release may not be released, published or distributed,
directly or indirectly, in or into the US, Australia, Japan, Canada,
South Africa or New Zeeland. The Offer does not apply to persons whose
participation requires further prospectuses, filings or other measures
in excess of those implied by Swedish law.

The information that appears in this document is a translation of, and
accordingly corresponds in all material respects with, the text of the
Swedish press release. In the event of any contradiction between the
text contained in this document and the Swedish press release, the
latter shall prevail.

VOLVO ANNOUNCES A PUBLIC TENDER OFFER TO THE SHAREHOLDERS IN KFAB

Volvo announces a public tender offer for the trucks and construction
equipment businesses of Bilia (KFAB). By exchanging its holding in
Bilia's car business for an increased ownership in Bilia's trucks and
construction equipment businesses, Volvo increases its focus on core
business.

* The board of directors of Bilia AB ("Bilia") has transferred
Bilia's trucks and construction equipment businesses to a separate
company (Kommersiella Fordon Europa AB, "KFAB") and proposed, to the
Annual General Meeting to be held on June 10, 2003, to distribute KFAB
to the shareholders of Bilia by way of a spin-off, whereby each share in
Bilia shall entitle to one share in KFAB 1)

* AB Volvo ("Volvo") offers three shares in "New" Bilia 2) for every
four shares in KFAB (the "Offer")

* The Offer is recommended unanimously by the board of directors of
Bilia, supported by a fairness opinion from its financial adviser
Enskilda Securities

* Volvo holds 43 per cent of the shares in Bilia before the Offer

* AB Custos, the second largest shareholder in Bilia, has stated that
it supports the Offer and will tender its shares in the Offer.

* A prospectus is expected to be published on or about 6 June 2003,
and the acceptance period is expected to commence on or about 13 June
2003 and end on 4 July 2003

May 26, 2003

For further information, please contact Marten Wikforss +46 31 66 11 27

1) Volvo, holding 43 percent for the votes, intends to vote in favour of
the distribution of KFAB at the Annual General Meeting.

2) Bilia AB after cash dividends and distribution of Kommersiella Fordon
Europa AB