Borgward news

[dmitra]

Originally Posted by Leo

So Ucar bought the Chinese factory and the management company has now become a subsidiary. Do I understand that correctly?

Yes.

Furthermore, Foton remains the sole owner of the Borgward Group in Germany. But what is really left there? The Bremen factory was cancelled earlier this year, so I assume there is some R&D and maybe the trademarks and naming rights. Will it become just the importer of Ucar-Borgwards?

I think you are more or less right. There hasn't been much news on the European side of the business in 2019. Last year Borgward was supposed to have been launched in Luxembourg. Apart from owning some IP, perhaps the German company will liaise with the independent sales channels in each [European] territory, also handle the Middle East distributorships? Work on software, user experience and connectivity suites? Perhaps some Borgward cars will make it to fleets and ride-sharing companies in Europe, following the business principles of Shenzhou.

[Leo]

I've read some reports about a Starbucks-like chain of coffee restaurants called Luckin Coffee is in trouble after some high ranking managers fabricated revenue numbers. Luckin Coffee is owned by the same holding that owns Ucar and thus Borgward. When Ucar acquired a majority stake in Borgward it also took on the debt of the company and now it looks like there may be problems in satisfying that debt.

More about the story:
https://www.caixinglobal.com/2020-04...101541178.html
https://www.yicaiglobal.com/news/chi...-luckin-coffee

[dmitra]

Here is the text of the report that blew the lid off the Luckin Coffee scandal (although shenanigans were suspected by analysts and stock watchers earlier too).

For how all this ties in with the Borgward acquisition about which questions are being raised, see Pages 38-46 (§ "Red Flag #2" onward).

[dmitra]

Now this:
https://www.scmp.com/business/compan...-luckin-coffee
https://www.d1ev.com/news/qiye/117433

______________________

It also transpires that Shenzhou UCAR had effectively paid much less for Borgward's 67% than announced publicly because of some compensation received from Foton for nontransferable land and real estate (due to some regulations), as well as adjustments in forward debt, collateral, and some credit received from Foton.

[Leo]

Yes, it seems to be a rather messy situation. I had already read this rather critical analysis of BAIC's purchase of CAR shares:

https://www.autonews.com/china-comme...ng-out-car-inc

It looks a lot like BAIC is bailing out mr. Charles Lu Zhengyao from his questionable business practices. Or maybe it's just trying all that it can get for the defaulted payments on Borgward before mr Zhengyao's empire collapses all together.

[dmitra]

Twist in the tale: Not BAIC, but SAIC ends up buying CAR Inc., through a Hong Kong subsidiary.

http://autonews.gasgoo.com/m/70017305.html
https://www.caixinglobal.com/2020-07...101574904.html

[dmitra]

It's BAIC again! SAIC has decided not to proceed:
https://www.d1ev.com/news/qiye/120672
https://www.d1ev.com/news/qiye/120660

However, the company is being investigated now by CSRC:
https://www.sohu.com/a/408712162_561670

[CCF mod]

Borgward Flounders Following Far From Ideal European Revival

https://www.carscoops.com/2020/08/bo...LOjBsEp6P1xGVY