Saab go back for another ChineseMon, 16 May 2011
Saab are saved (?) by Pang Da Auto
There can’t be many companies in China who haven’t had Victor Muller banging on their door armed with a chunk of Saab stock in exchange for a hat full of Chinese currency.
A couple of weeks ago we had the news that Saab had signed a deal with Chinese car Maker Hawtai for €120 million in exchange for a big chunk of Saab stock and lots of ‘joint’ venture. But that fell apart last week even before Victor Muller could get to consummate the marriage.
Now we get news of another lifesaving deal for Saab, although we have to admit that this one does look rather promising. And this time, instead of tying up with a Chinese car maker Saab has got in to bed with a car distributor.
And not just any old car distributor, but Pang Da Automobile Trading Co (also known as Power Diversity Automobile Trade Group Co) who have over 1100 dealerships and are flush with cash from a recent IPO, and who are well used to dealing with high-end Western cars. They already have Mercedes, Audi, Subaru, Toyota, Hyundai, Volkswagen and Honda and dealerships. Saab should fit a treat.
The deal is for Pang Da to place an immediate order for €30 million of Saab cars (and maybe another (€15 million in the next month) which should give Saab some instant liquidity as the sale of cars shouldn’t need permission from the various vested interests like the Swedish Debt Office, GM, EIB and Uncle Tom Cobley.
The second part of the deal – for Pang Da to bag 24% of Saab for €65 million – will have to wait until the vested interests put their two bob’s worth in, but there seems no real conflict of interest here so it should be straightforward.
The deal also includes a joint venture sales company and a joint venture to build Saabs in China. The production venture probably has a lot of hurdles to become reality, but this looks like a deal that should stick, and should allow Saab to finally get back in to production.
Victor Muller was feeling chuffed with the deal this morning. “It´s a good day to be alive! Pang Da Automobile will be a great boost for us!” he said.
Let’s hope he’s right this time.
By Cars UK