For the past decade, Volvo has focused on making safe sexy. Sleek designs and souped-up engines have chipped away at the image of the Volvo as a boxy, baby seat-friendly tank, but it still retains more cachet as a cradlemobile than just about any other car. That could all change with new ownership.
An unnamed source at China’s Changan Automobile tells the National Business Daily that Ford is trying to sell the high-end Swedish car brand to Changan. The report didn’t provide much more detail.
For Ford, such a move is hardly reckless. Though they are in better shape debt-wise than GM and Chrysler, Ford has been looking to unload pricey brands for some time and will need cash to see them through what is expected to be a protracted economic downturn.
Chinese automakers may not be in much better shape, though, as the auto market slows globally. While it’s not hard to see why a safety-conscious brand might command a premium in China, a country much maligned for exporting unsafe products, Volvo is hardly alone in the For-Sale spotlight in what is still the world’s fastest growing major economy.
GM may be more desperate to sell its Saab brand – another Swedish safety scion – than Ford is to dump Volvo. Industry sources say U.S. auto companies have approached a number of Chinese companies about possible asset sales but found little interest. The Chinese automaker Chery secured a $1.45 billion loan this week and said it would use the funds to improve its product quality rather than to buy U.S. auto assets.
Deals of the day
* Prudential Financial, Manulife Financial and three other firms are expected to place competing bids for two Japanese life insurers put up for sale by American International Group, according to people familiar with the matter.
* India’s Oil & Natural Gas Corp will go ahead with its $2.6 billion takeover of Imperial Energy after a British regulator denied its request for an extension, the Economic Times reported, citing an unidentified person involved in the deal.
* Vodafone said it would make a public offer for navigational and locating services firm Wayfinder Systems, valuing the Swedish company at 239 million Swedish crowns ($30 million).
* UK life insurer Friends Provident will pay 170 million ringgit ($46.8 million) for a 30 percent stake in Malaysia’s AmLife Insurance Bhd as it gears up its presence in Asia.
* Australian zinc miner Perilya voiced confidence that its deal to sell a controlling stake to Chinese smelter Shenzhen Zhongjin Lingnan Nonfemet would win foreign-investment approval. The Chinese company will become a majority shareholder in Perilya following a share placement, Perilya said in a statement.
* Oz Minerals, the world’s second-largest zinc miner that is scrambling to refinance its debt, has attracted the interest of several Chinese metals companies, according to three sources with direct knowledge of the matter.
* Land of Leather Holdings said it had terminated talks with potential bidders.
* Shares in Norwegian information technology group EDB Business Partner rose as much as 11 percent after business daily Finansavisen said Telenor is in talks to sell its 51 percent stake.
* United Business Media, a British publishing and exhibitions group whose PRNewswire distributes corporate press releases, said it acquired Sanguine Microelectronics for an initial $8 million to expand its presence in China.
(Photo: Reuters/Bob Strong)