General Motors Corporation (NYSE: GM) may have an answer as to what could happen with that Saturn unit. Just be sure you stress the “may” in this thought. A press release came out mid-day noting that an investor group “emerges to acquire Saturn.” There may be more caveats and questions than there are answers, so for now we are only considering this as hearsay. The group includes private equity firm Black Oak Partners, LLC. This group is unknown to us. Here is a link to the full press release.
Black Oak Partners is said to be working with a number of Saturn retailers and announced that it has approached General Motors about acquiring and operating the principal assets of Saturn Distribution Corporation (SDC) as a diversified automobile distributor and retailer. SDC is the legal entity that franchises Saturn retailers today.
This release notes that a “new” Saturn Distribution Corporation is envisioned as a unique model for new car retailing in the United States which will leverage Saturn’s brand and source products from OEMs for distribution through Saturn’s existing network of approximately 440 US and Canadian retailers.
The new SDC will become a model of lean-distribution that leverages unique Saturn equities, like “market area approach”. It also notes that the nSDC will initially source vehicles from GM, but expects over time to offer smaller, fuel-efficient vehicles from a range of manufacturers. It would retain a light vehicle design function that will help other manufacturers, but this notes that nSDC will not directly engage in manufacturing activities.
A call has been put in for the relations firm here, but so far no answers are really there as to how this would play out. It may be something, and it may be nothing. Until we have some definitive data, we are considering this as hearsay.
GM shares are still up 5% today at $1.87, but there has not really been any movement since this release came out. Apparently, we are not the only ones that have more questions than answers in this matter.
Jon C. Ogg