Tuesday, July 7, 2009
General Motors has several deals in the works as it tries to shed some of its brands to focus on Buick, Chevrolet, Cadillac and GMC. The automaker had previously decided to shut down Pontiac.
Hummer: Chinese engineering firm Sichuan Tengzhong Heavy Industrial Machinery has tentatively agreed to purchase GM's line of 7,000-pound gas guzzlers for less than $500 million, says one source. Last week GM kicked off formal discussions with Chinese regulators to win government approval for the sale. But a China National Radio report cast doubt on the deal, saying the brand could be at odds with China's environmental goals.
Saab: High-end Swedish sports car manufacturer Koenigsegg has arranged to purchase GM's Swedish unit for an undisclosed sum. The sale, expected to close in the third quarter, is contingent on a $600 million funding commitment from the European Investment Bank backed by the Swedish government.
Opel: Two months ago, GM signed a memorandum of understanding with Canadian parts maker Magna International, which has partnered with Russian state-owned bank Sberbank, to sell a majority stake in German unit Opel and its British counterpart Vauxhall. Next week Magna's board is set to discuss the $976 million investment, a portion of which would be backed by the German government. But recently Beijing Automotive made an offer for Opel valued at $923 million, and GM has stepped up talks with the Chinese bidder, said a person familiar with the matter.
Saturn: Racing legend Roger Penske has committed to buy the Saturn dealer network for an undisclosed amount. GM said the deal will save more than 13,000 jobs and 350 dealers. Penske's automotive group has an impressive track record for turning around businesses, and his reputation has already started to boost Saturn sales, say some dealers.
-- Kendra Marr