Swedes mulling bid to buy Volvo back from Ford

I hope the Swedes restore ownership of Volvo. I've owned four volvos, my last one a 1990 model 740. In 1968, my children and I visited Sweden and toured the Volvo and Saab auto factories. I bought a Saab Sonnet. Thereafter I bought Volvos. At the Saab factory, we were treated to a Saab jet plane demonstration. Scared me to death as it dove overhead at us. A tour of the factories demonstrated why the Swedes produce such good cars. ---BBB

Swedes mulling bid to buy Volvo back from Ford
By Tim Webb
Published: 01 July 2007
Independent UK

Super-rich Wallenberg family eye US car giant's European 'jewel in the crown'

Volvo could return to Swedish ownership after one of the country's wealthiest families became the Ford subsidiary's latest suitor.

The Wallenberg family controls Investor AB, a publicly quoted Swedish investment conglomerate which already owns an 11 per cent stake in truck maker Scania.

Investor AB is understood to be considering a bid as part of a consortium of investors for Volvo Cars, owned by the US-based Ford. Unions would welcome Swedish ownership, which could give it an advantage over other foreign-led bids.

Ford is insisting that its subsidiary, which makes just under 500,000 cars each year, is not for sale. Fredrik Arp, the chief executive of Volvo, last week refused to answer questions about the company's future but did not rule out an auction.

Ford, which lost $12.7bn (£6.3bn) last year, wants its management to concentrate on turning around its main business in the US. Following a review of its European subsidiary, Premier Automotive Group (PAG), it sold the British marque Aston Martin earlier this year.

It has appointed banks to review Jaguar Land Rover, which is also expected to be sold, provided a buyer can be found. Jaguar Land Rover has a value of around $1bn.

The most valuable asset in PAG is Volvo. Analysts at Merrill Lynch estimate that Volvo will make a pre-tax profit of $559m this year. Ford does not strip out the performance of the different PAG brands.

One potential sticking point over a sale of Volvo is that its operations are more closely integrated with Ford's. Other companies cited as possible bidders include the German car maker BMW.

But a non-trade buyer for Volvo is thought to be more likely because of the disastrous track record of recent industry mergers. In April the private equity group Cerberus bought Chrysler from DaimlerChrysler for $7.4bn when the car group finally gave up on the merger.

Paul Newton, an analyst from Global Insight, a consultancy, said: "Any new owner of Volvo would need to take the workforce with it. With the amount of stories creeping out, there is no question that [Ford's] banks are trying to sell all of the PAG brand.

"It's all up for sale. Ford is asking a lot of money for it - it's the real jewel in the crown."

A spokesman for Investor AB said: "We do not comment about market rumours and speculation." A PAG spokesman declined to comment.

Volvo Cars was founded in 1927 in Sweden.