Australian consortium wanting to spend up to $750mill to acquire Holden plant

[Brazen]

Interesting, big money being talked about - wouldn't be surprised if its a bank or Super fund that is interested. Obviously all pie in the sky stuff at this stage, but way too much value sitting there to throw away.

http://www.adelaidenow.com.au/news/s...-1226821061430

A private consortium of investors is in talks with General Motors over the future of the Holden manufacturing plant at Elizabeth. Source: News Limited
AN AUSTRALIAN-based consortium is mounting a bid to take over Holden's soon-to-be-vacated Elizabeth plant and continue making cars beyond 2017.

Ethan managing director Ashley Fenn said he and a group of fellow businessmen were in talks with General Motors about buying the plant.

He said the talks also involved the possibility of possibly gaining access to the company's brand and intellectual property.

Last month, Holden corporate affairs executive director George Svigos ruled out the company selling its name and said it was "completely committed to the Holden brand and intends to sell Holden cars for many years to come".

It followed comments from Premier Jay Weatherill that "a particular car manufacturer might want to set up here but use the equity that's in the Holden brand to continue making cars".

Mr Fenn told The Advertiser said talks with General Motors, Holden's Detroit-based parent company, had been "extremely positive".

He also said the consortium was willing to work with other car makers to save thousands of jobs at the plant and in component companies. The state and federal governments as well as unions have been briefed on the plan, he said.

Mr Fenn said unnamed equity partners were already prepared to offer $750 million.

Manufacturing, Innovation and Trade Minister Tom Kenyon last night confirmed the State Government was in talks with the group and treating the bid seriously.

"They're doing work, talking seriously to GM and, if they're successful down the track, then that would be a good result for South Australia," Mr Kenyon said.

"They're not to be dismissed. Their goal is to manufacture vehicles in SA."

He confirmed the State Government was in similar talks with other companies but declined to name them. Mr Kenyon would not comment if extra taxpayer support was being considered.

Mr Fenn is also the Victorian state director of the Family First Party, on the party's federal executive and was a Senate candidate at last year's federal election.

Mr Fenn said he and other consortium members began working six months ago on plans to develop a "sustainable business model" for Australia car manufacturing.

That was soon after Ford's announcement it was ending domestic automotive manufacturing and while it was also clear then that the "writing was on the wall" for Holden, he said.

Mr Fenn said his consortium has engaged former executives from GM and Mitsubishi and was in discussions with financiers to raise capital.

"We really go into industries and companies and do turn arounds," Mr Fenn said. "What we've been able to do is collect some of Australia's best thinkers in this field.

"We've also been talking with financiers and capital partners. Our ultimate intent is to continue to manufacture cars in South Australia."

"Depending on what assets we might buy from whatever company, we'd look to put a business plan together, do a deal and then look to either take over or restructure".

Mr Fenn is also the operator of a not-for-profit housing development business, Ethan Housing.

He said the consortium was confident that the global car industry was positioned for growth and that an Australian company focused on both exports and domestic supply could be profitable.

Mr Fenn said negotiations with Holden and other companies had "months to go".

He said it was possible the consortium could "start from scratch" to develop a completely new car model and brand if it could not win agreement from an established car maker.

"We don't know whether we're buying just a plant, whether we're buying a plant with the platform and the name or it's a walk-in-walk-out-type scenario on the business," Mr Fenn said.

Mr Fenn said it was possible to profitably build cars in Australia.

"Obviously the currency has been very high," he said. "That hurts Australian manufacturing.

"We don't believe the currency is going to stay as high as it has been.

"On the other side is, there has always been a struggle between the companies and workforce.

"Having our interest here, in Australia, rather than the US, will make a very big difference."

Mr Fenn said the consortium did not intend to seek subsidies above what is already in state and federal Budgets and was not factoring in an assistance beyond 2020.

"We understand taxpayers are not going to want to subsidise an industry that's not going to be self-sufficient," he said.

Mr Kenyon said he would work with the consortium to progress its bid.

"GM is taking them seriously and I wouldn't want to be so sceptical that I missed an opportunity. "I'm happy to work with them to try and progress it," he said.

"There is a large amount of capital involved and the proof will be in the pudding of course.

"If they're able to keep manufacturing cars in South Australia, that's success."