SAIC: We Want A Share Of GM. A Share? Make That A Bunch
There are increasing possibilities that GM will be owned by two governments: The American and the Chinese. After a lot of rumor and innuendo, Hu Maoyuan, Chairman of China’s government-backed SAIC went on record today and said he does not rule out the possibility of participating in GM’s IPO. That according to Reuters.
Reuters had heard in September that SAIC had told GM to send them the prospectus. Now, if Reuter’s sources are right, SAIC has expressed an interest in acquiring a “single digit” share in GM. Well, it’s a start.
SAIC’s Chairman Hu Maoyuan had only the warmest words for his joint venture partner: “We are positive on GM we believe the restructuring is very good for GM. We can see that it is moving to a healthy direction of development,” told reporters. “We will study and pay close attention to it, and yes, this is such a big IPO, and GM is moving to a very positive direction. I believe demand in the U.S. will pick up as the economy recovers. We are positive on GM.” SAIC has a vital interest in the wellbeing of GM. Together, they make more cars in China than GM in the U.S.A.
And they have the money: SAIC said this week it expects net profit for the first nine months of the year to grow by at least 140 percent from a year earlier on strong vehicle demand. They also have a flush lender, should cash ever become an issue.
Actually, it’s an interesting start. GM owns 49 percent of the China JV ( they used to own 50 percent, they sold the 1 percent for bupkis). Now assume they end up owning 9 percent of GM that owns 49 percent of the Chinese JV. Get my drift?
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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If SAIC wants to spend good money on our old crap, I say let them. Maybe we have some more junk in the attic we can dump on them?
China is not buying the prize US company GM was in the 1950's, it is buying a much thinned out shell. It's akin to buying Polaroid or Xerox or rights to the Plymouth trademark. When GM dropped the Pontiac and Oldsmobile name plates, it was admitting there was much less beef on the bun.
This isn't even news. This was predicted back when the editors of this site first posed the question; "Who would want to own a piece of GM?"