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GM in talks on partial Saab sale to BAIC: sources
NEW YORK/DETROIT |
NEW YORK/DETROIT (Reuters) - General Motors Co is talking to BAIC, China's fifth largest car maker, about a partial sale of assets associated with its Saab brand, including tooling and technology, two people with direct knowledge of the discussions said.
Beijing Automotive Industry Holding Group has made it clear that it has no interest in acquiring Saab's production hub in Trollhattan, Sweden, according to the people who could not be named because the talks remain private.
Under the proposed deal, BAIC, which lacks its own car brand, would set up production in China based on an older generation of Saab vehicles, including the 9-5 and 9-3 models, the people said.
The partial sale of Saab technology to BAIC would likely clear the way for a liquidation of other assets held by the brand, including its headquarters and could threaten more than 3,000 Saab jobs in Sweden.
At the same time that GM is talking with BAIC, it is also vetting several other bidders that have expressed an interest in buying all of Saab, the sources said.
BAIC has said it remains interested in Saab, part of a push by Chinese car makers to upgrade their technology and expand production. A BAIC representative could not be reached immediately for comment.
GM declined to comment. The automaker, which came through a bankruptcy funded by the U.S. government in July, said it will not discuss negotiations because of confidentiality agreements with potential bidders.
GM's board of directors wants to see that any potential bidder has financing lined up by the end of December and will set a strict time limit for any deal, the sources said.
Although the Swedish government could still intervene to tip the balance, those tough conditions and the fast timetable make it more likely that a partial sale of Saab to BAIC will be the only viable option for GM, one of the sources said.
It was not immediately clear if any Saab-derived models built by BAIC would be sold in a way that showed their association with the historic brand, one of the people said.
GM's board has said it will take until the end of December to consider whether it can conclude a deal to sell Saab.
BAIC had been in discussions to provide financing to Koenigsegg, a tiny Swedish car builder that pulled out of a tentative deal to buy Saab last month.
On Friday, BAIC obtained a $2.93 billion line of credit from the Bank of China.
Beijing-based BAIC has tie-ups in China with Daimler AG (DAIGn.DE) and Hyundai Motor Co. (005380.KS)
Dutch specialty car maker Spyker Cars has said it is interested in buying Saab. Privately owned Renco Group, backed by U.S. financier Ira Rennert, has also expressed an interest.
The discussions with BAIC over a sale of some Saab assets come as another Chinese automaker, Geely (0175.HK), is pursuing a deal to buy another Swedish brand, Volvo.
Ford Motor Co (F.N) has picked Geely as its preferred bidder for Volvo. (Editing by Carol Bishopric; editing by Carol Bishopric)
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