Romanian govt' agency in talks with Ford for sale of former Daewoo car factoryPublish date: 07-07-2007
Romania's privatization agency will begin talks with Ford Motor Co., the only bidder in the sale of a former Daewoo car factory in southern Romania, officials said Friday.
Ford's bid was opened at an event in Bucharest, but no details of the offer were revealed.
"At first glance, it looks like all the documents requested have been submitted," said Sebastian Vladescu, who is deputy Finance and Economy Minister and head of the privatization committee in charge of the sale. He said talks were to begin on Monday with Ford to negotiate the terms of the sale.
Ford, the only bidder in the sale, confirmed in a press release that it wants to buy the plant. Ford "offers the best combination of financial, technological and environmental commitments" to modernize the Craiova-based plant," said Ford of Europe President and CEO John Fleming.
Ford believes the facility in Craiova is a strategically important site for the company's future growth. Ford of Europe produced 1.86 million units at seven assembly plants in 2006 and additional manufacturing space is needed to meet its ambitious new product and growth plans.
"If we are successful in our bid, we would expect to expand and improve the Craiova manufacturing operations, increase employment and attract additional suppliers to the area," said Fleming.
General Motors Corp. and JC Russian, two companies which sent letters of intent to participate in the sale, have not submitted bids.
The government has said price would not be the only factor considered in the sale, but the buyers' ability to maximize production and use Romanian-based suppliers.
The privatization agency, which is selling the government's 72 percent stake in the company, will sign a memorandum with several smaller shareholders to sell their stakes as well, allowing the buyer to take over 95 percent of the stock.
The factory, which was owned by the bankrupt Korean company, employs about 4,000 workers and can produce up to 200,000 cars and 300,000 engines per year.
Romania paid US$60 million (€44 million) last year to buy back a 51-percent stake in the company from Daewoo's creditors.
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