An investor group that includes a number of Saturn retailers
said Wednesday it has approached struggling auto maker General
Motors Corp. (GM) to acquire and operate the principal assets of
Saturn, saying the model would benefit as a new independent
retailer.
If successful, the company would outsource auto production,
initially from GM, and eventually make "smaller, fuel-efficient
vehicles" from a range of companies.
Saturn is among the properties GM has said it is looking to pare
as it focuses on its primary brands, including Chevrolet and
Cadillac, while trying to stem red ink and deal with an industry
sales depression.
Private-equity firm Black Oak Partners LLC said it was working
with Saturn retailers to acquire Saturn Distribution Corp., the
group that franchises with Saturn retailers. The entity didn't
disclose any monetary offer and an official declined comment,
though did say informal talks began last month.
A spokeswoman from GM wasn't available to comment.
In a statement, investor group spokesman John S. Pappanastos
said, "GM will be relieved of liabilities related to retailer
franchise agreements and avoid the downstream financial fallout on
their other brands that would result from closing Saturn retail
facilities." He said the move would salvage more than 10,000 retail
jobs that might otherwise be lost in a GM reorganization and
"mitigate the potential for substantial local economic impact from
Saturn retailer bankruptcies."
Saturn dealers have been anxious about their future as GM has
faced intense government pressure to accelerate its restructuring.
In February, the company announced it would close its Saturn brand,
with dealerships planned to be closed by 2011 and no new models set
to be introduced under the nameplate. The announcement was part of
GM's viability plan that it submitted to Congress and Obama
administration.
GM has already received $13.4 billion from the U.S. government
to stay afloat and is seeking an additional $16.6 billion cash
infusion.
Its shares were up 5.1% to $1.87 in recent trading; the stock
has lost 87% of its value from September.
-By John Kell, Dow Jones Newswires, 201-938-5285, john.kell@dowjones.com