New US challenger enters bidding on Volvo
October 8, 2009 by Matt Brogan
A US-led group has entered the race to buy Volvo from Ford in a challenge to China’s Geely Automotive.
A Ford spokesman said the group was in discussions with interested parties about Volvo cars, but declined to identify the parties, the price of the bid or to comment on the timing of any sale.
Citing people close to the sale, the US Financial Times said the Crown consortium had fully secured financing from US private equity groups. But the consortium was also seeking additional backing from Swedish investors to signal its intent to keep Volvo in the country.
The Crown consortium is fronted by former Ford director and turnaround specialist Michael Dingman and former Ford and Chrysler executive Shamel Rushwin.
With Rueters
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Have you ever wandered that the Company selling the company may ask another company in secret to place a bid to try and get the highest bidder to raise their price. I know this would somehow be illegal but in reality you could not prove it could you. I think thats what many car companies do to try and flog off their dodgy merchadise for high prices. Ford could have asked these new comers to try and place a false bid to get Geely worried and in response Geely would post a higher bid if they really wanted the brand. Some food for thought.
as they have worked for Ford in the past, I’d certainly be investigating it.
In Carmaker’s Collapse, a Microcosm of South Korea’s Woes
NYTimes
“Chinese company BOE got the technology they wanted. All we got was layoffs,” said Hwang Pil-sang, a Hydis worker.”
“We trusted their promise to help us into the vast Chinese market,” Mr. Yang said. “In the end, they kept none of their promises, and they got what they wanted: our technology.”
http://www.nytimes.com/2009/02.....p;ref=asia
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not surprise.
After Chinese company get the technology they wanted, They will kill world automotive industry with cheap price volvo. Volvo workers in sweden will replace by cheap pay chinese workers soon.
I just can’t see this working. If you look at the history of private equity firms buying car companies, they just don’t work. Phoenix bought Rover cars from BMW and lasted a few years. Same with Cerebus buying Chrysler. And in both those cases, they paid almost nothing. With the Crown buy out, the have to service the huge debt to buy Volvo, then run the company, build cars, then invest the billions needed for the continual updates required to remain competitive. I just can’t see them lasting.
For what its worth, I think the same will happen with the Magna buyout of GM Europe. GM USA have been very clever. They have or will, retain a small shareholding. In a few years when Magna is in trouble, GM will step in and buy it back for next to nothing. Well thats my take on it anyway.