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Ford Faces $2Billion in UK Pensions Shortfall

Discussion in 'Fred's House of Pancakes' started by Pinto Girl, Nov 7, 2007.

  1. Pinto Girl

    Pinto Girl New Member

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    Ford Faces $2B ln UK Pensions Shortfall - FT

    Nov 7, 2007 17:31:32 (ET)

    DOW JONES NEWSWIRES

    Jaguar and Land Rover have an estimated pension deficit of more than $2 billion, meaning that Ford Motor Co. (F) is likely to have to pay any buyer to take the U.K. luxury car brands off its hands, the Financial Times reported Wednesday on its Web site, citing people close to the situation.

    Ford, which is in discussions with both industry and private equity companies over a sale, is expected to sell the loss-making operations in a deal valuing them at more than $2 billion. But with Ford likely to retain a significant minority stake, the value to the U.S. company of any sale would be more than swallowed up by the pension shortfall, the FT reported.

    Ford received financial offers from at least six auto makers and private equity groups last week, and heard detailed bid presentations over the weekend, the newspaper said.

    The U.S. auto maker this week selected Indian vehicle makers Tata Motors Ltd. (TTM) and Mahindra & Mahindra Ltd. (500520.BY), and buyout group One Equity Partners - whose bid is spearheaded by former Ford chief Jac Nasser - for detailed negotiations.

    However, people close to the sale process describe it as fluid and say the field could change, as Ford attempts to maintain competitive tension in the ­auction, according to the FT.

    Ford isn't commenting on the sale, but is expected to give a brief progress update with third-quarter earnings Thursday.

    Newspaper Web site: http://www.ft.com

    (END) Dow Jones Newswires

    November 07, 2007 17:31 ET (22:31 GMT)

    ------------

    At least Ford's keeping a minority interest. But wouldn't it be funny if Equity One ends up with those brands? Bill Ford and Jac Nasser never really saw eye to eye; if that deal were to go through, they'd be back in the car business together!

    I'll be watching for that earnings report. I'm scared, maybe a little.