Genii Capital pulls out of Saab bidding process

Genii Capital pulls out of Saab bidding process
Bernie Ecclestone bows out of Saab bidding, image: Brazil's F1 Grand Prix 2009
The Luxembourg investment firm backing Formula One boss Bernie Ecclestone's efforts to purchase Saab from General Motors said on Monday it was dropping out, leaving Dutch carmaker Spyker as the last remaining bidder.

“Genii Capital concluded today that the timing of the bidding process for Saab is incompatible with implementing a solid business platform for the future,” it said in a statement released on Monday.

The firm said it had engaged in “a period of intensive study and evaluation,” having been “brought into the year-long bidding process for Saab just three days before the closing deadline.”

However, it concluded that the “next stage” in an existing partial shutdown at Saab introduced during the negotiations was not compatible with “closing the transaction.”

The decision leaves Dutch sportscar maker Spyker as the only bidder for GM’s loss-making Swedish unit.

Rumours were rife on Monday that a deal between Spyker and GM had been finalized following a report by Swedish Television that a loan approval from the European Investment Bank (EIB) had been approved, paving the way for the sale to go through.

But officials from all parties involved in the negotiations subsequently denied that a deal had been struck, including GM chair Ed Whitacre.

“As of today we have not changed our direction on the wind-down of the operation,” Whitacre said in a press conference on Monday, referring to the process of shutting down Saab.

“We do not have a deal to announce this morning.”

Nevertheless, Spyker shares soared on rumours of the Saab deal, climbing by 77 percent to €3.80, the company’s biggest stock price jump since it went public in May 2004.

Saab, which employs 3,400 people in Sweden, is one of four brands being shed by GM as part of a massive restructuring effort that began in 2005 and accelerated last year when the largest US automaker went bankrupt.

Analysts have warned that some 8,000 jobs could be lost with Saab’s closure.

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