When the Romanian government put a 72-percent stake in Automobile Craiova SA on the block, it got one bidder: Ford. The Blue Oval first offered fifty-five million euros in July, then upped it to fifty-seven million euros, which equals $78 million dollars.
Before the government stepped in, Craiova was owned by Daewoo Motors' Romania, which was separate from the GM-owned Daewoo. The Romanian arm went bankrupt in 2006. The state bailout came to the tune of $61 million dollars, which paid for assets and debts. The last year of its operation under Daewoo, the plant put out 24,000 cars. Ford, after a planned $675 million investment in the plant, wants to up that production to 300,000 cars. Conjecture is that Ford will make the Festiva there.
The deal is expected to close on September 12, during the Frankfurt Auto Show. Yet more evidence that in spite of troubles at home, Ford is raging bullish on its overseas operations.
[Source: Reuters]
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