SHANGHAI - Beijing Automotive Industry Holding Co (BAIC) said on Monday it had acquired some assets of General Motors' Saab unit as part of a push to develop its own-brand cars.
BAIC, China's fifth-largest automaker, will buy the intellectual property for Saab's 9-5 and 9-3 sedans and some equipment to make them for an undisclosed sum, leaving the fate of the Swedish-based automaker up in the air.
This is quite separate from the discussion to sell Saab as a whole, and those negotiations are taking place, a Saab spokeswoman in Sweden said, declining to name potential bidders.
What this deal announced today does is that it partly helps the financing of the 'new' Saab...The deal with Beijing in no way compromises the sale of Saab to a new owner.
Luxury car maker Spyker has also expressed an interest in Saab and said on Sunday the BAIC deal would be good news as talks continued with GM.
State-run BAIC is joining Geely Automobile Group and other fast-growing Chinese auto firms in chasing Western brands to take advantage of a steep global industry downturn.
BAIC is one of the few major Chinese auto groups that still does not have its own car brand. Even though the Saab platform is old, it's still important for BAIC as it can finally get hold of something it can use later on for its own cars, said John Zeng, an analyst with IHS Global Insight.
Most Chinese automakers are either churning out foreign brand cars in tie-ups with global heavyweights such as Volkswagen AG, Toyota Motor or focused on the lower end, making cars as cheap as 30,000 yuan ($4,394).
But as wealth grows in what has now become the world's biggest auto market, many Chinese carmakers are looking to boost their profile.
The deal is an important milestone in BAIC's cooperation with Saab, BAIC said in a statement.
BAIC will get support from Saab as it uses the acquired technologies to manufacture its own-brand models, it added.
SPYKER STILL IN THE FRAME
Spyker CEO Victor Muller told Reuters on Sunday the Dutch sports-car maker was still in talks to buy Saab, after the Wall Street Journal initially reported BAIC's deal to buy the 9-5 and 9-3 assets.
He said a deal with BAIC would be good news for the Dutch company, because it involved assets that he described as equipment for old Saab models.
Saab spokesman Eric Geers said he was confident that a buyer for the whole of Saab Automobile would be found.
GM has said it would consider offers for its Saab brand until the end of this month and move to close the Swedish unit then if it appears that it cannot be sold.
BAIC, a Daimler AG and Hyundai Motor, hopes to use acquired technologies to shore up its own-brand models, which it has been working on for years.
The deal will put BAIC on par with domestic rivals, such as SAIC Motor Corp, Dongfeng Motor Group, which have already rolled out cars developed based on acquired technologies or on their own.
SUCCESS AT LAST
BAIC has made several aborted attempts to get access to foreign auto brands this year.
Shortly after it dropped out of a race for GM's Opel brand, BAIC agreed in September to take a minority stake in Koenigsegg, a tiny luxury car maker, which struck a deal earlier this year to buy the loss-making Saab unit from its Detroit owner.
Last month, BAIC issued a state immediately after Koenigsegg's abrupt pull-out from the talks saying it was reviewing its options while reaffirming its commitment to become more global.
Its general manager Wang Dazong told reporters recently that BAIC might still be interested in Saab even though he saw no need to buy plants or robots.
Sources told Reuters last week BAIC has obtained a 20 billion yuan ($2.93 billion) line of credit from the Bank of China.
Geely, the Chinese car maker picked as the preferred bidder for Ford Motor's Volvo unit, is seeking at least $1 billion in loans from Chinese banks to finance its bid, sources said earlier this month.
Money shouldn't be a major problem, the big challenge for BAIC and many other Chinese automakers is to come up with new models based on the acquired technologies, said Zeng.
(Additional reporting by Victoria Klesty in Stockholm)
(Editing by Lincoln Feast)