VW Offers to Save Karmann
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VW Offers to Save Karmann
FRANKFURT (Reuters) - Volkswagen AG aims to take over Germany's Karmann, bringing the company back from the brink of going bust, two people familiar with the matter said.
Without fresh funds, the coachbuilder and convertible roof-top specialist, which is most famous for building the VW Beetle-based coupe dubbed the Karmann Ghia, will have to shut down in early November.
"Talks have been going on for some time, but there is no agreement yet on a price," one of the sources told Reuters on Sunday.
A spokesman for Karmann told Reuters that Karmann and VW had been in touch with each other but declined to comment on the content of talks. VW declined to comment.
Sources said that the three families that own Karmann -- Battenfeld, Boll and Karmann -- want to fetch a price of about 65 million euros ($97.5 million) from a buyer.
That figure includes outstanding payments for a painting plant that Karmann bought for about 100 million euros a few years ago and has not yet paid off.
VW bids low
German weekly magazine Spiegel said that VW has bid a low double-digit million euros sum for Karmann, considerably less than the owning families are looking to get.
Karmann developed the retractable hardtop roof first introduced with the Mercedes-Benz SLK. The idea was later copied by competitors, finding widespread use in popular volume models such as the Peugeot 207cc.
In recent years, a trend among automakers to reduce outsourcing the assembly of entire models weighed on Karmann's order book. After delivering its last Mercedes CLK in June, Karmann's coachbuiding business was left without work.
"If new money does not arrive quickly, liquidity will tend towards zero soon," a spokesman for administrator Ottmar Hermann said on Friday. "Without money we will not be able to pursue business and will not be able to avoid closure."
Customers owe Karmann an amount in the double-digit million euro range, sources told Reuters.
Magna interest
According to sources, Magna Car Top Systems, a Magna International Inc. subsidiary, and Spanish supplier CIE Automotive were interested in Karmann's roof division.
But now Magna is tied up with buying a stake in Opel and CIE is struggling with a debt pile of 650 million euros and a sharp drop in operative earnings in the first six months of 2009.
Both companies declined to comment.
After drastic job cuts in the last months, there are 1,700 workers remaining at Karmann, which filed for insolvency on April 8.
Contact Automotive News
Without fresh funds, the coachbuilder and convertible roof-top specialist, which is most famous for building the VW Beetle-based coupe dubbed the Karmann Ghia, will have to shut down in early November.
"Talks have been going on for some time, but there is no agreement yet on a price," one of the sources told Reuters on Sunday.
A spokesman for Karmann told Reuters that Karmann and VW had been in touch with each other but declined to comment on the content of talks. VW declined to comment.
Sources said that the three families that own Karmann -- Battenfeld, Boll and Karmann -- want to fetch a price of about 65 million euros ($97.5 million) from a buyer.
That figure includes outstanding payments for a painting plant that Karmann bought for about 100 million euros a few years ago and has not yet paid off.
VW bids low
German weekly magazine Spiegel said that VW has bid a low double-digit million euros sum for Karmann, considerably less than the owning families are looking to get.
Karmann developed the retractable hardtop roof first introduced with the Mercedes-Benz SLK. The idea was later copied by competitors, finding widespread use in popular volume models such as the Peugeot 207cc.
In recent years, a trend among automakers to reduce outsourcing the assembly of entire models weighed on Karmann's order book. After delivering its last Mercedes CLK in June, Karmann's coachbuiding business was left without work.
"If new money does not arrive quickly, liquidity will tend towards zero soon," a spokesman for administrator Ottmar Hermann said on Friday. "Without money we will not be able to pursue business and will not be able to avoid closure."
Customers owe Karmann an amount in the double-digit million euro range, sources told Reuters.
Magna interest
According to sources, Magna Car Top Systems, a Magna International Inc. subsidiary, and Spanish supplier CIE Automotive were interested in Karmann's roof division.
But now Magna is tied up with buying a stake in Opel and CIE is struggling with a debt pile of 650 million euros and a sharp drop in operative earnings in the first six months of 2009.
Both companies declined to comment.
After drastic job cuts in the last months, there are 1,700 workers remaining at Karmann, which filed for insolvency on April 8.
Contact Automotive News
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Senior Member
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