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U.S. firm Merbanco out of Saab bidding; Spyker said to submit bid

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U.S. firm Merbanco out of Saab bidding; Spyker said to submit bid




DECEMBER 2, 2009 08:54 CET

MUNICH - U.S. private investment firm Merbanco Merchant Banking said it is out as a bidder for Saab.

Merbanco CEO Christopher Johnston said Saab parent General Motors Co. informed him that Merbanco was out after a board meeting on Tuesday in which Saab's future was discussed.

"We were disappointed to learn we were not invited to move forward in our efforts for Saab," Johnston told Reuters.

GM has given Saab a reprieve until Dec. 31 while it considers new bids for its money-losing Swedish brand.

GM said there are several interested parties in the Saab brand, but declined to name those potential bidders, citing confidentiality agreements.

A source said Dutch super sports carmaker Spyker Cars NV and its Russian owner, Converse Bank, have submitted a bid to buy Saab.

Beijing Automotive Industry Holding Co, which tied up with Saab bidder Koeningsegg in October, could still be among the possible contenders to take over Saab, according to reports.

Spyker attracted by Saab's image

Spyker apparently wants Saab because of Saab's strong image. Also, GM's plans for the brand, such as a new 9-4X crossover, "look extremely viable" to Spyker's management, the source said.

U.S. financier Ira Rennert and his Renco Group had also expressed interest in pursuing a deal for Saab before GM struck a preliminary deal with Koenigsegg earlier this year.

GM said it will evaluate potential bids between now and the end of December but if it is unable to find a "suitable arrangement" for Saab by then, it would "will begin an orderly wind down" of the global Saab business.

GM's board met on Tuesday to review Saab's future after a deal to sell the brand to Swedish sports car maker Koenigsegg fell apart last month.

According to a report on Tuesday by Bloomberg News, GM also is considering the sale of parts of Saab to Beijing Auto and shuttering the brand. In that case, Spyker likely would pull its bid, Bloomberg said, citing people familiar with the matter.

Saab confident

Saab spokesman Eric Geers said there are a number of parties seriously interested in buying Saab.

Geers said he did not know how far the bidding process had gone, but that "a number" of possible buyers had been identified.

"There is serious interest from buyers," Saab spokesman Eric Geers said.

Asked if he was confident Saab would find a new owner, he said: "We are confident."

Sweden's Enterprise Minister Maud Olofsson said it was too early to say if Saab would survive.

"We have won a little time," she said. "It is a complicated issue to buy Saab. The buyer needs to have enough financial muscle to buy the company and to develop Saab."

She said the government would do all it could to help the process.

GM's failed attempts to boost Saab

GM bought 50 percent of Saab in 1989 for about $700 million. It paid $125 million and assumed debt for the remainder of the unit in 2000.

But the Swedish luxury brand best known for its 9-5 and 9-3 sedans has consistently lost money over the past two decades. Saab has said it lost about $340 million in 2008.

Efforts to use GM platforms to engineer recent Saab models failed to win back buyers and an ad campaign to sell the brand as "Born from Jets" fizzled.

Koenigsegg, a Swedish company that hand builds sports cars that sell for $1 million, said in late November it was pulling out of a deal to buy Saab because of the risk of delays in closing five months after reaching a preliminary deal with GM.

Saab sold 93,295 vehicles globally in 2008, representing 1.1 percent of total GM sales volume, down 25 percent from 2007.

Reuters contributed to this report

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