General Motors has announced that it is exploring a potential sale of ACDelco, its global independent aftermarket parts business, a deal which could net the beleaguered automaker US$4 billion.
The sale of the GM Service & Parts Operations brand is expected to promote more rapid growth of ACDelco globally, a heady statement considering that it is already one of the best-known global automotive brands. Merrill Lynch has been retained to investigate the potential sale.
Canadian investment firm Onex has been touted as a possible bidder. Founder Gerry Schwartz has had previous experience with the automotive industry, and Onex board member Peter Godsoe reportedly had ties to General Motors when he was CEO of the Bank of Nova Scotia.
Accordingly, the estimated price tag of US$4 billion for ACDelco was said by one media outlet to be “right in Onex’s sweet spot.”
The move for a the potential sale comes after General Motors announced in July that it is undertaking a number of initiatives to bolster its liquidity position by approximately US$15 billion through year-end 2009, including the sale of assets which are expected to generate approximately US$2-$4 billion of liquidity.
In addition to the ACDelco business, GM previously announced it is exploring the potential sale of its Hummer brand and its technical and manufacturing centre in Strasbourg, France.
ACDelco, which provides light-duty maintenance and repair parts and associated services for both GM and non-GM vehicles in more than 100 countries, is part of GM Service & Parts Operations, is headquartered in Grand Blanc, Mich., and has approximately 600 employees worldwide.
GM has retained Merrill Lynch to assist in this initiative.