There’s so much to love in John
Reed’s story about Ford selling Land Rover and Jaguar: it’s full of juicy
goodness. But the very best bit comes at the end:
Ford, which lined up a $23bn financing package to see it through its restructuring
late last year, has repeatedly denied immediate plans to sell the two brands.
When Aston Martin was sold in March Lewis Booth, PAG’s head, said: "Jaguar
and Land Rover are not for sale."
This is simply embarrassing. You don’t say in March that the brands are not
for sale, only to start shopping them around in June. What this means is that
Ford lacks strategic vision, and that it is still casting around desperately
for ideas.
A few other tidbits:
Ford Motor has given Goldman Sachs, Morgan Stanley and HSBC a mandate to
sell Jaguar and Land Rover.
It takes three investment banks to sell these marques? I think the
story here is that Ford has borrowed so much cash from these banks that it feels
beholden to them and has to give them any M&A mandates that may or may not
come along.
A spokeswoman for Alchemy Partners denied a newspaper report that the private
equity group was lining up a £3bn bid to buy the brands. Alchemy had been
interested in Jaguar and Land Rover, she said, "but only at the emotional
level".
It’s worth noting that £3 billion is $5.9 billion: in other words, these
two small, money-losing brands are worth almost as much as Chrysler. They might
not have Chrysler’s built-in healthcare liabilities, but they do have widening
losses, and Jaguar in particular seems to be something of a money pit. On the
other hand, there’s no guarantee that Ford will be able to get anywhere near
£3 billion. But if there’s lots of interest "at the emotional level,"
then maybe it will be able to get lots of hugs and kisses instead.