Who wants to GM’s Hummer division? A wealthy Russian, an Indian automaker, and a Turkish private equity group.
BusinessWeek: Reuters is reporting that General Motors, which markets civilian vehicles under the Hummer brand has been in talks with Russia’s richest man, Oleg Deripaska, to sell the brand. Separately, sources have told Businessweek that Indian automaker Mahindra and Mahindra, as well as a Turkish private equity group have also inquired about buying the brand.
GM announced last June that it was evaluating the future of Hummer, which is code for seeking buyers. GM is hurting for enough cash to see it through its current woes and economic downturn in the U.S. It lost more than $15 billion in the second quarter alone…
While Hummer sales have declined precipitously in the U.S., sales and interest is holding up abroad, especially in Eastern European and Middle Eastern countries where gasoline is much cheaper and in some cases subsidized by the government. Too, audacious looking vehicles like Hummer, often decked out in expensive after-market equipment, are popular with the growing number of wealthy Russians, including the “gangster class.”
UPDATE: According to Dealbook, “Mahindra & Mahindra is “not pursuing” the acquisition of General Motors‘ Hummer brand, Anand Mahindra, the Indian car company’s managing director, told reporters Monday.”
Luxury blog Luxist notes that Deripaska’s company responded to reports of its interest in buying the Hummer brand: “In the wake of the reports, Russian Machines issued a statement saying it was “not strategically interested in such a deal”, which sounds to us like a non-denial denial. We would hardly expect him to invite counter-offers by publicizing a planned acquisition before the deal is signed.”
So what do we know about the Hummer’s future owner? Luxist reveals that Deripaska is 40 and has a fortune of $28 billion, making him the richest man in Russia and the 9th richest man in the world. (The better-known Roman Abramovich is the 15th wealthiest man in the world.) He also hired Rihanna for a New Year’s Eve concert for him and his friends. The price: $500,000 for a 40-minute show.
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