) - After helping to bail out Europe, China is becoming a more specific financial savior.
Long-struggling Saab Automobile will likely be sold for a second time in two years to ward off a crippling bankruptcy and resume its car making business. The company said in a press release that its entered into a sale 'memorandum of understanding' with Chinese automakers Pang Da and Zhejiang Youngman for $142 million. The acquirers will also provide long term funding to Saab Automobile, according to a press release that says the offer is valid until November 15.
Saab halted production last March because of cash shortfalls and narrowly skirted a bankruptcy filing in September after courts in Sweden gave it a stay from creditors. Saab was a piece of
for nearly two decades until the U.S.'s largest automaker filed for bankruptcy in 2009 and decided to discontinue its Saab, Saturn, Pontiac and Hummer brands.
In 2010, GM sold Saab for $400 million to Swedish Automobile, but the company's continued to struggle. In 2006, its best ever year, the carmaker sold 133,000 cars but has seen its brand diminish significantly recently. In 2010, Saab is reported to have sold just 31,700 cars. Previously, Pang Da and Youngman had agreed to buy a 53.9% stake in Saab's parent Swedish Automobile for 245 million euros.
After two months of uncertainty,
new CEO Meg Whitman has made her second decisive stamp on the world's largest computer maker in a month, by announcing the company will retain its division. HP announced on Thursday, after spending the last few months
of its computer business - that it was too important to overall revenue and the company's supply chain to be cut.
"HP objectively evaluated the strategic, financial and operational impact of spinning off PSG. It's clear after our analysis that keeping PSG within HP is right for customers and partners, right for shareholders, and right for employees," explained HP CEO Meg Whitman, in a statement released after market close on Thursday.
HP rose nearly 5% to $28.34 a share in early trading. The stock, which is down over 30% year to date and is one of the Dow Jones Industrial average's worst performer, has recovered over a quarter of its value since Whitman's CEO nomination.
HP CEO Meg Whitman
The possible PC spinoff, one of a host of strategic changes announced by the company's former CEO Leo Apotheker earlier this year, proved unpopular with investors. Ultimately, the strategy contributed to
CEO Whitman arrived at HP at the end of September and made a promise to Wall Street and the company's customers that it would decide on strategy in short order. Her first move was to close HP's purchase of software maker
for $10.3 billion in October, the company's second largest ever acquisition ever. She then promised that by the end of October, the company would decide on whether to retain its computers and smartphones using its webOS operating system.
Whitman's made her own stamp in Thursday's announcement, continuing PC's, cutting its foray into smartphones and tablets and rearranging the company's management structure. She and Todd Bradley will look over the traditional PC and hardware groups, while chairman Ray Lane will oversee its Autonomy bolstered software and services division. It is a signal that after the Autonomy acquisition, HP will look to integrate its now expanded parts quickly - while looking for synergies.
Whitman's decisiveness is a strong move that may stem any customer or employee defections. For newly hired IBM CEO Virginia Rometty, a similar decisiveness one that was key to her success at IBM. When the company was considering a similar push to higher margin businesses like software and services in the early 2000s, the company bought the 30,000 employee strong consulting arm of PwC for nearly $4 billion and quickly integrated it into its existing behemoth Global Services unit. Rometty is said to have led the division with a decisiveness and clarity that comforted employees during a time of flux. Whitman's moves this October may prove to have the same effect as the company seeks to revamp innovation and its business model.
-- Written by Antoine Gara in New York
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