The Hindu Business Line : Oil money seeks to acquire auto brands

THE car industry analyst, Mr Krish Bhaskar's is an Indian name associated with what seems a very audacious set of acquisition plans disclosed in the automobile industry.

For the very reason that the plans have been publicised, senior automobile industry officials here reacted guardedly to the puzzling development.

"If you are serious, you don't normally outline your plans," one of them said. Mr Bhaskar's name popped up three days ago when The Sunday Times cited him as the Monaco-based leader of a consortium called `Triple A', backed by oil money from West Asia , which submitted a bid for MG Rover. While the report maintained that it was unclear whether PWC — MG Rover's administrators — regarded the bid as serious, Triple A on the `1Automotive' Web site has claimed, it is the "No 1 preferred buyer of PWC".

The Web site declined comment on the media-reported bid size of £65 million but mentioned that total budget earmarked for MG Rover was £2.6 billion . It said, the consortium intended to better the £100 million -bid submitted by the Russian millionaire, Mr Nikolai Smolenski, owner of TVR.

"Triple A has essentially a very large source of funding to the tune of several billion pounds. With that Triple wants to buy MG Rover and other companies," the Web site said. According to it, "the funding is extensive and up to several billion pounds can be drawn upon through a financing vehicle called AMAR, which offers guarantees pledged on oil and other assets in West Asia but which are then swapped for Western bank guarantees. Essentially these funds are blocked for expansion into automotive manufacturing."

In a link to Mr Bhaskar's background, the Web site described him as the son of an Indian father and an English / South African mother, born in Hampton Court and educated at LSE. He later taught at LSE and founded both the Motor Industry Research Unit (Miru) at the University of East Anglia and the 1Automotive range of companies.

At least one industry official here recalled Mr Bhaskar as a UK-based consultant.

The site, which associated Mr Bhaskar with several automobile marquees and deals, also said, "During the 1980s and 1990s he was the sole adviser to the European Commission on such issues as State aid, innovation in the automotive industry and block exemption."

But what was intriguing about Triple A and which triggered chat at industry related Web sites was the prospective growth plan it outlined. First, even as it bared details on what it planned to do with MG Rover, the consortium said that in the event of losing out in the bid it would try to buy the company back at a premium. Second, MG Rover (budget of £2.6 billion) was the first likely buy and set for 2005.

Over 2006-07-08, it wanted to buy engineering consultancies (having green technologies) around the world followed by an yet unapproved desire to acquire Maserati in 2005-06. The brand is owned by Fiat, but Triple A reasoned Maserati would come up for sale. Then some time during 2005-06-07, the consortium wanted to buy Land Rover, Jaguar and Aston Martin (budget of £7-10 billion). "Ford may be willing as it will restore its credit rating," went the explanation.

It also had unapproved plans to buy discrete units that did not fit into other manufacturers' plans, mentioned under the list being BMW's Mini, the Smart from Mercedes Benz, Morgan, Noble and " others." Triple A's ambition did not end there.

It posed an FAQ: Why not go for Fiat, GM or Ford? "Answer: Kirk Kirkorian has already made a bid for GM and we hope to team up with him at a later date." Fiat, it said, would be elusive because the Italian Government won't allow it to go into administration while Ford is "complicated" with the family having a say in the business.

Interestingly, the Web site, featuring plenty of material on Triple A, had a separate section on other bids, submitted or likely (in the consortium's view), for MG Rover. Among nine names therein, including the Russians, Chinese, Iranians and Taiwanese — was "Indians." "We were expecting last minute purchase decisions by Tata. So far these have failed to materialise," it said.

Needless to say, the Web site's contents have drawn different views from surfers. Few would dispute the consortium's reasoning for some of the brands floating up for sale. But the question is: Why are they talking?

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