When General Motors (GM) laid out its restructuring plan back in June, one of the major elements in its resurgence was the decision to sell off some of its under performing brands. On Tuesday, the new GM announced that it has signed its first big deal to get rid of one of these gangrenous limbs. Koenigsegg Automotive AB, a Swedish high-performance car manufacturer has tentatively agreed to purchase the popular brand. If the deal goes through, Saab will probably go to Koenigsegg in September.
The deal, which is still conditional, hinges on a few uncertain elements, including a funding commitment from the European Investment Bank. This influx of cash would, in turn, be guaranteed by the Swedish government. The loan would be partially contingent upon Koenigsegg's ability to find a further $413.6 million to fund the sale.
Saab's move to its fellow Swedish firm could be very beneficial for all involved parties.For GM, it involves selling a division that is under performing and, arguably, diluting the GM brand. For Koenigsegg, on the other hand, it represents a means for entering into the mass-produced car market.
Koenigsegg, which was founded in 1994 by Christian Von Koenigsegg, began producing street-legal production cars in 2002. Their CCXR, a "bioflexfuel" car, can run on a wide variety of ethanol and petroleum-based fuel mixtures. It is also the most high-powered car of its type, beating the Bugatti Veyron by 17 horsepower.
If Koenigsegg's acquisition of Saab goes through, the company will have a mass-production platform to which it can fuse its well-regarded custom automobiles. While the new Saabs will be priced well out of the range of many of GM's customers, they will still cost far less than Koenigsegg's other cars, which hover in the half-million dollar range.
It also might offer new purpose-built production facilities to Koenigsegg, which is currently headquartered in a pair of aircraft hangars in Angelholm, Sweden.
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