Volkswagen joins bidders for Rolls-Royce cars
Saturday 15 November 1997
Reports from Germany yesterday suggested that VW had already made a bid and had all but won the contest. But a spokesman for parent company Vickers, which put Rolls up for sale three weeks ago, dismissed this as "nonsense".
BMW of German has already confirmed that it is interested in buying Rolls and, despite a denial yesterday, Daimler-Benz is also thought to be contemplating a bid.
All three main US car groups - General Motors, Ford and Chrysler - are believed to be eyeing Rolls although, again, GM yesterday denied it was interested. The other possible bidder is Fiat of Italy, which owns Ferrari and Alfa Romeo.
Industry observers said they doubted whether any British bid would now emerge following the collapse of the planned pounds 1bn hostile bid for Vickers by the car components and engineering group Mayflower.
It was pointed out that only large car companies with deep pockets and specialist knowledge of the business were likely to bid. Since BMW bought Rover three years ago, Britain no longer has a UK-owned volume car maker.
Analysts estimates of Rolls' value range from pounds 250m to pounds 600m. It is reckoned to make profits of about pounds 21m a year. But any buyer would probably have to invest a further pounds 500m to renew the model range.
German press reports said that VW had made an informal offer that was likely to be accepted. But a Vickers spokesman said: "The deal is not done, that is wrong. The timetable goes well into next year and the deal may not be done until the spring."
He also pointed out that Lazards. Vickers financial advisers, had not yet sent out the Memorandum of Sale to interested parties and was still in the process of registering expressions of interest.
Another observer said: "There is a peculiar German dynamic to all this. BMW, VW and Daimler delight in tweaking each other's tails. In particular, VW likes the idea of taking the battle on to BMW's forecourts." BMW has been approached by a dozen wealthy Rolls owners asking to be included in any bid it decides to make.
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