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Geely No Longer Among Suitors for Saab

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[source: Wall Street Journal]

Geely No Longer Among Suitors for Saab

By NORIHIKO SHIROUZU

BEIJING--An investment group led by Chinese auto company Geely Holding is no longer a candidate to acquire General Motors Corp.'s Saab unit, according to two people familiar with the situation.

GM has narrowed the field of potential buyers for Saab, and the group led by Geely Holding, the parent of one of China's biggest home-grown carmakers, is not among them, the people said. It wasn't immediately clear whether the Geely group withdrew, or was rejected by GM.

A Saab spokesman confirmed the field has narrowed to "two or three" candidates. He declined to identify them.

The group led by Geely, based in the eastern Chinese city of Hangzhou, is still believed to be in the hunt for Ford Motor Co.'s Volvo unit, also based in Sweden. Geely Chairman Li Shufu wasn't immediately available Friday for comment.

The Wall Street Journal reported in early May, citing people familiar with the situation, that Geely Automobile Holdings Ltd., Geely Holding's Hong Kong-listed unit, had submitted a bid for Saab, an assertion that Geely Automobile later denied. Since then, other knowledgeable people have indicated that the Saab and Volvo bids came from a group led by Geely Holding and Mr. Li, who heads both the parent and subsidiary companies.

Before submitting a bid for Saab in April, the Geely group had expressed interest in buying Volvo, for which it has also submitted a bid. A Ford spokesman didn't immediately respond to a request for comment.

On Friday, Saab won more time to pursue a likely sale and avoid bankruptcy after a local Swedish court granted an extension to the struggling company's creditor protection period.

The Saab spokesman said the Vanersborg district court's ruling means the GM unit can continue its restructuring of Saab until Aug. 20, after which a new extension would need to be sought. He said GM still plans to pick by the end of June the "final candidate" from the field of "two or three" potential investors that remain in the process.

"We will pick the finalist soon," the Saab spokesman said in a telephone interview.

Saab went into creditor protection on Feb. 20 in an effort by GM to spin off or sell the unit. Saab officials, who have described the court-managed reconstruction as "the most comprehensive" ever done in Sweden, earlier this month confirmed that as many as three bidders remain in the sales process that began with 27 prospective buyers.

Geely has said it is interested in using international acquisitions to gain access to technologies and sales networks, and to circumvent trade barriers it might otherwise face as a Chinese auto maker.

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Thank God!

I knew in someways it was a good news for you.

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It is.

Koenigsegg, Renco Group and someone else are rumoured to be the final 3 bidders. However, SAAB people have said that those 'final 3' all have connections to the auto industry, so... idk... what does Renco have in the auto business other than being the owner of AM General? And who is the mystery 'candidate nr 3'?

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