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.

However, analysts say BAIC may still need a foreign partner clinch the Saab deal due to certain policy constraints.

Analysts say the Saab deal could have been an ideal fit for BAIC as its minority shareholding in Koenigsegg which would have come with the deal would have given it the kind of exposure in mergers and acquisitions, it sorely lacks. It would have gained much needed experience in post merger integration, that calls for highly cultivated and deeply embedded organisational capabilities that can be developed only first hand.

As Koenigsegg shareholder, the deal could have offered the right kind of exposure to BAIC's managers to gain the sort of experience needed to make an acquisition work when it decided to make an acquisition on its own. BAIC does not have that chance now, they add.