(NYT) Koenigsegg Group, the luxury Swedish carmaker, said Wednesday that it would sell a stake to the state-owned Beijing Automotive Industry Holding as part of the Swedish company’s purchase of General Motor’s Saab unit, in the latest push by a Chinese automaker expand outside its domestic base.
The agreement came just hours after another Chinese carmaker, Geely Automotive, said its parent company planned to bid for Volvo Cars, the Swedish brand that is being sold by Ford Motor.
Beijing Automotive Industry Holding, or BAIC, will take a minority stake in Koenigsegg. “This is an important step on the road toward a new Saab,” said the Koenigsegg chief executive, Christian von Koenigsegg. “We have a well-prepared business plan, an important partnership and we are ready to proceed without state financing.”
Koenigsegg, backed by U.S. and Norwegian investors, struck a deal in June to buy the unprofitable Saab from G.M., but questions about financing had dogged the deal. The company said it could not disclose financial details of its deal with BAIC because of a confidentiality agreement.
A Saab spokesman, Eric Geers, said a sale to Koenigsegg was now certain by the end of October. “This naturally also offers fantastic opportunities for Saab in the Chinese market. It is clear that this will help Saab hugely,” he added.
BAIC, which does not have its own car brand, dropped out of the bidding for Opel, another G.M. brand, in July, and had reportedly been interested in bidding for Volvo.
Also on Wednesday, Gui Shengyue, the chief executive of Geely, said its parent, Geely Holding Group, would include a government-backed investor as part of any bid for Volvo. The purchase could lift the profile of Geely, a privately owned company, and give it access to technology it needs to upgrade its lineup.
But some analysts expressed doubts about Geely’s ability to make an acquisition work. “It’s a risky move,” said Ji Junfeng at Changjiang Securities. “I’m not sure how Geely can turn around a brand like Volvo.”
A Ford spokesman, John Gardiner, declined to confirm discussions with Geely. “We are still continuing to hold discussions with parties that are interested in Volvo, but we are declining to name those parties,” he said.
Geely is the first company to confirm its intention to bid. A consortium led by Swedish companies has reportedly shown an interest in Volvo as well.
“On the assumption that the parent successfully acquires Volvo, it will fine-tune the product line and technology until Volvo becomes profitable, and then inject the assets into the listed company,” said Vivien Chan, an automobile industry analyst at Sinopac Securities.