Soon a collector's item?
General Motors confirmed today that the proposed sale of its Saab subsidiary to Koenigsegg Group AB was terminated at the “discretion of the buyer.”
General Motors had signed a memorandum of understanding in August to sell Saab Automobile AB to Koenigsegg, but without all of the needed financing in place. The Swedish government then refused to lend money to Koenigsegg. At the time, Koenigsegg said it needed another $425 million to make the proposed business plan work. The business plan developed by Koenigsegg was never revealed, but it was critical for the sale to move forward.
To make the deal work, Koenigsegg, the ultra small Swedish sports car maker for the ultra rich, put together a plan with Beijing Automotive Industry Holdings Company Ltd. BAIC, which is controlled by the Chinese Government, would have become a minority owner in Koenigsegg Group.
“We were as surprised as anyone,” a senior General Motors executive tells TheDetroitBureau.com. Asking not to be identified by name, he adds, “There were some indications over the weekend things were getting squishy…but we were moving towards a close.”
It remains to be seen if problems with the Beijing Auto partnership led to the collapse of the sale, but at this point, a GM source stresses there are “no other buyers in tow.”
As a result, the future of its loss-making subsidiary now appears grim, since GM has said it will not put any more money into the operation.
“We’re obviously very disappointed with the decision to pull out of the Saab purchase,” said GM President and CEO, Fritz Henderson in a statement.