Koenigsegg’s pull out from Saab deal could hit BAIC’s plans
25 Nov 2009
Swedish luxury car maker Koenigsegg Group, which has abandoned plans to take over GMs Swedish venture Saab six months after it announced takeover intent in June, haas dealt a severe blow to Beijing Automotive Industry Holding (BAIC) which was to become a minority owner in Koenigsegg with the deal.
The deal, which was to be concluded by October, failed to materialise due to repeated delays forcing the Swedish acquirer to finally abandon it altogether. (See: Swedish carmaker Koenigsegg calls off Saab acquisition)
Koenigsegg $600 million loan request was not acted upon by the European Investment Bank.
According to BAIC it has always been an important strategy at BAIC to go international. In the wake of the development, BAIC said it will have to weigh its options and reassess the project in a prudent manner.
BAIC had also set its sights on Opel, another European unit of GM in July. However, the deal failed on issues concerning intellectual property.
According to analysts BAIC may still decide to go ahead with the bidding on the strength of its own financial resources.
BAIC posted a net profit of $370 million that was up 78 per cent from the same period last year in the fist six months, according to state media reports. By way of contrast Saab under GM rarely posted a profit and last year lost $341 million.
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