Originally Posted by The Swede
By Polya Lesova, MarketWatch
FRANKFURT (MarketWatch) -- Shares of Spyker Cars N.V. surged on Monday after the Dutch car maker said it has submitted a new offer for Saab, the Swedish unit of General Motors, after an earlier deal broke down last week.
GM announced Sunday it has received inquiries from several parties regarding Saab, though it didn't name these parties.
"We will evaluate each inquiry," Detroit-based GM said in a statement. "We will not comment further until these evaluations have been completed."
GM had said Friday it would wind down Saab Automobile AB after it was unable to reach a deal to sell it to Spyker Cars, a Dutch producer of high-end sports cars, because certain issues arose during due diligence that couldn't be resolved.
However, Spyker (NL:SPYKR 2.14, +0.43, +25.15%) (DE:L9I 2.17, +0.05, +2.36%) said Sunday it had submitted an 11-point proposal to GM, addressing each of the issues that arose during the due diligence process.
The renewed offer, Spyker said, would remove the obstacles that were standing in the way of a swift transaction. Spyker's new offer for Saab is valid until 5 p.m. Eastern time on Monday.
"We are very confident that our renewed offer will remove the impasse that was standing in the way of an agreement on Friday, and this would still allow us to conclude the deal prior to the expiry of the deadline originally set by GM of December 31," Spyker CEO Victor R. Muller said in a statement.
The new offer "addresses every known issue brought to light during the initial negotiations" and has the full backing of Saab's management, Muller said.
It "eliminates the need for an EIB loan approval prior to year end, for example, which will allow the deal to be concluded within GM's deadline," he said, referring to a potential 400 million euro loan from the European Investment Bank.
IHS Global Insight auto analyst Ian Fletcher said the renewed offer raises the question of where Spyker will find the cash to buy Saab and fund it for the foreseeable future.
"The EIB loan has always been thought to be key to any buyer acquiring Saab, which despite the cash that GM has thrown at it over the years continues down a loss-making path," Fletcher said in a note to clients. "It would certainly require very deep pockets to fund the brand, without much reward."
GM had previously attempted to sell Saab, which was founded in 1937, to another producer of sports cars, Koenigsegg Group.
The Detroit car maker has said it's focusing on its four core brands Buick, Cadillac, Chevrolet and GMC as well as on several regional brands -- including Opel/Vauxhall in Europe -- after its reorganization in bankruptcy court and the receipt of billions of dollars in U.S. government aid.
Based in Zeewolde, the Netherlands, Spyker is a manufacturer of premium sports cars. Its largest shareholder is Russia's Convers Group, which owns a 29.3% stake.
The company sold 23 cars in the first six months of the year. A Spyker car costs, on average, about 180,000 euros ($258,000) depending on the model and the market.
For the first half of 2009, Spyker reported a net loss of 8.7 million euros, slightly higher than its loss in the same period a year ago. First-half revenue declined to 4.1 million euros from 5.7 million euros a year ago. In late November, Spyker said it will relocate vehicle assembly to the U.K. from the Netherlands in order to cut costs.
Polya Lesova is reporter for MarketWatch, based in Frankfurt.
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12-21-2009, 09:52 PM
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