I've just been chatting with a contact at Saab in Sweden and he's provided me with the following information:
- The investment process moves into a more intensive phase
- Over 20 potential investors
- Small number of auto companies interested but the majority are investment groups
- Interest comes from Sweden, elsewhere in Europe, the US and Asia Pacific region
- All have been vetted by Deutsche Bank and have the capability to become investors
- All have signed confidentiality agreements and have been sent a 'teaser brochure'
- Some have moved into the next phase and have either visited Trollhättan already or have booked a visit in order to take part in more detailed discussions.
Note that Deutsche Bank are engaged by General Motors to find Saab's buyer, which means that GM's interests are paramount in this process, but also note that GM's best interest is served by Saab surviving to engage in future contracts with them. It's hopefully going to be a win-win.
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I noted in comments as I was putting this together that there's also coverage at Reuters and in the Swedish media (thanks ctm)
E24 report the following:
"There are now 27 interested parties to Saab Automobile. Yesterday, the first of them visited the Saab factory in Trollhättan.- Interest has been growing. Saab has signed confidentiality agreements with 27 potential buyers. The interest from Wednesday's visitors was very large, a source tells Dagens Industri.
One interested buyer per day are received by Saab, so the this period is expected to be rather long. First, the "heaviest" ones visit factories and meet with management, and yesterday's secret visitor was one of the more serious buyers.
Saab is reported to first talk to those who have the greatest capacity, capital and skills to take over the auto company."
And Reuters have this to say:
Loss-making General Motors unit Saab Automobile said on Thursday it had signed confidentiality agreements with 27 potential suitors in its efforts to find a new owner to help it survive the downturn.Saab's court-appointed administrator said earlier this month that about 20 potential buyers were looking at the company and that a deal was expected to be completed in June.
"It is of course positive that there has been this level of interest," Saab spokeswoman Gunilla Gustavs said.
The Swedish carmaker had held meetings with representatives of potential buyers this week, she added.
"We are now in an intense and more organized phase of presenting the company to potential interested parties," she said.
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Thanks to ctm and Tompa/Moose in comments!
I mean GM NA has created more losses in the last couple of years than SAAB in the last 20 GM-owned years.
Thanks for the coverage Swade. This is encouraging.
Chrysler in a shotgun marriage with Fiat, Saturn's sole hope is a dealer buyout, how many looking at Volvo or Opel?
This is great news, this much interest means Saab's mojo is still powerful.
I mean, when was the last time you heard 27 buyers were interested in buying ANY company?
Hmmmm, Porsche.....
It would be interesting to hear what the true figures are.
And Im glad that the investors are non-car companies, as they would do less of intgrating saab into other brands, instead they would be building / developing a stronger brand, in other words what is best for saab.
Asia "Pacific", puzzels me though, are we looking at a potential buyer other than the usual suspects from mainland china.
Finally, I just got a crazy day at work today, my job in the construction industry is usually quite slow these days as a result of the Economic Downturn. For some reason for the last few days, all the clients that gives my company jobs but went for sleep in the last year, has suddenly started calling on the phone again, not just one but many. Seems like a small indication that companies are wanting to start investing again, or atleast is sniffing around for bargains. If this is close to the bottom of the downward spiral in Asia atleast, maybe Saab is being sold at the perfect time.
Cheers.
Man, I'm so sick of that. My God I hope (in the case of SAAB) that THE BEST REVENGE -IS- SUCCESS, that SAAB becomes more of a success than GM has EVER been. It's funny, SAAB has been in this predicament because of the Parent Company, let me say that again, Parent Company.........
http://www.thelocal.se/18892/20090416/
As for Koenigsegg, it is possible that if a wealthy Arab sheik is indeed one of the serious bidders for Saab, he may also be contemplating buying the supercar maker and creating a mini Swedish conglomerate.
Nevermind "a badge-engineered Vectra", our Saabs will be rebadged Koenigsegg CCXs. How cool is that, huh? :)
I am so glad to hear Saab is generating interest whereas GM is drawing a ton of negative press. Saab did the right thing by sorting its out problems out before GM became the dire mess it is. JAJ is a god in my books for his vision!!
In a competitive M&A sales process for a company (as in the case of the sale of Saab), companies with any interest at all in a company or the industry in which such company operates regularly sign confidentiality agreements in order to get their hands on an information memo (and the valuable information contained therein), even if they have zero interest in purchasing the target. Remember, there probably was a small army of analysts at Deutsche Bank, GM and Saab putting together this info memo - it's likely to be 100 plus pages long, plus pro forma stand alone financial information for Saab (GM's accounting is so screwed up, the bean counters probably had to do a lot of work to separate out meaningful financial data for Saab). I am sure thousands of hours went into preparing it, and accordingly it's a nice bit of info on a car company and the indurstry.
The signing of a confidentiality agreement only shows that there are 27 parties interested in getting their hands on the info contained in the information memorandum - not that they are actually interested in buying the company.
I would presume that the next phase following the execution of the confidentiality agreement (let's call it Stage II) would be for interested parties to submit non-binding indicative bids, on the basis of which GM would pick two or three serious parties to move to the next stage (let's call this Stage III). In Stage III, the selected "preferred bidders" would be invited to do legal, tax and financial due diligence on Saab (this is likely to take months with a company of this size and complexity - think of the labour and intellectual property issues alone!), and negotiations would take place which would end (hopefully) in each party submitting binding bids. The party submitting the binding bid which is picked as the "winner" by GM would then proceed to signing the share purchase agreement and other transaction documentation.
This is the way these processes are normally structured in my experience (having advised clients in similar M&A processes over the years). I am sure that there is a process letter accompanying the information memorandum setting forth the rules of the process along the lines of that described above.
Accordingly, the real interesting information will be the number of parties who submit non-binding indicative bids. These are parties who actually have an interst in purchasing SAAB, as they will actually go through the trouble of putting together a bid. Signing the confidentiality agreement does not cost anything - and potentially could be of great benefit to a party signing it.
Accordingly, the number of persons signing the confidentiality agreement is NOT a good guage of interest, and I caution everyone from getting too excited by this seemingly high number.
Sorry to dampen anyone's enthusiasm.
Ed K.
But, as Ed K. said, some might be looking for insight/info into SAAB and/or the Auto Industry. The next stage is crucial, as serious buyers will perform some Valuation exercises and some preliminary non-binding offers will be made based on those. Then, keeping in mind that SAAB is seen by buyers as a distressed company, the REAL (and most fun IMHO - I miss it a lot) buyers/sellers game starts! ;)
The next 9-3 and 9X/Air can sport a lesser 325HP 2.0 twin turbo.
http://www.auto-motor-und-sport.de/news/saab-verkauf-gm-offeriert-saab-zum-nulltarif-1200970.html
http://www.ft.com/cms/s/0/eecd70fe-2ab0-11de-8415-00144feabdc0.html?nclick_check=1
It seems like GM is willing to give SAAB Away for free.
What I most like from the article is the fact that FT's description of SAAB
sounds much better than Reuters's
most interesting points:
"...bidders include an individual investor, a consortium of Swedish companies and at least two private equity firms, said the person, who didn’t want to be named because the talks are private. None of the most likely bidders are automakers, the person said. ...as many as 27 potential buyers, including car manufacturers as well as investment companies from all continents, [Eric Geers quote] ...The [Swedish]court may grant the company extensions of up to one year in total in three-month steps. ... [JAJ] intends to focus on four new models in the next 18 months that emphasize engineering and safety and promote the company’s turbo-charged engines. Saab predicted it will make fewer cars in 2009 and 2010 than the 93,000 produced last year, and that it needs to make 130,000 cars to break even. ...
GM, which has taken over most of the claims on Saab to become Saab’s largest creditor with more than 90 percent of the total claims, is likely to agree to write down Saab’s debt by 75 percent, as proposed in Saab’s restructuring plan, Geers said. GM has claims on Saab of 9.6 billion kronor, Saab said April 6.
“I don’t see the writedown as an issue or hindrance at all,” he said. “Talks with GM are proceeding in a great way.”
Six serious buyers is great (Chrysler eat your Jeep out).
What I want to know is who are the investors from Australia and Antarctica??? I mean, EVERY continent? Is SWade really with his investment banker in Sydney? :)
(ok,am watching 5 years of MI-5 in two weeks, so conspiracy theories are everywhere. saving the exploding 9-3 in season 6 for May)
Saab to be sold for $0 !!
AMS reports in Germany that GM is willing to give Saab away "for free":
http://www.auto-motor-und-sport.de/news/saab-verkauf-gm-offeriert-saab-zum-nulltarif-1200970.html
I think both companies will be there next year and the year after, and I think both european companies will offer beter products without the american mother, but this shows which brand (loss-making or not) has mojo and which not.
And that'll just be the entry fee.
To buy SAAB sure is a more limited risk than buying Opel.
Still, it'll require a lot of financial power - and a lot of commitment, too.
SAAB is certainly and obviously going independent, and I personally find it to be a much more interesting company to follow that route because it has a lot of potential/value as a BRAND, not just a badge like Opel/Vauxhall.