General Motors, Ford and JC Russian have submitted letters of intent in the privatization for a former Daewoo carmaker in southern Romania, the government said Thursday.
Romania wants a major investor to take over the struggling company in Craiova, which still produces Daewoo models, including Cielo, Matiz and Nubira. The government said price would not be the only factor considered in the sale, with buyers also to be rated on their ability to maximize production and use Romanian-based suppliers. Potential buyers also would be required to prove they are producing at least 1 million cars per year and have a turnover of at least €10 billion ($13.6 billion). The privatization agency, which is selling the government's 72% 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% of the stock. The factory employs about 4,000 workers and can produce up to 200,000 cars and 300,000 engines per year.
Analysts see the Craiova factory as a good opportunity for carmakers who want to take advantage of cheaper specialized labor in Romania, which joined the European Union in January. Romania paid $60 million (€44 million) last year to buy back a 51% stake in the company from Daewoo's creditors. (chron.com)