Penske Nabs Saturn: GM's third deal in 10 days

Penske Automotive Group (PAG) has signed a memorandum of understanding to purchase Saturn from General Motors. Thursday, there appeared to be 16 suitors, with GM suggesting the list would be pared to three or four this month with a final decision coming in the third quarter. What will happen in the third quarter is that Roger Penske will slide another major entity under his umbrella.

No details regarding proposed purchase price - believed to be more than $100m - have been revealed. An estimated 13,000 U.S. jobs could be saved with the transaction. Penske also expressed interest in having current Saturn general manager Jill Lajdziak remain at the helm. Former Chrysler co-President Tom LaSorda, who acted as a consultant during Penske's negotiations with GM, may also wind up on Saturn management team.

Penske's major target was Saturn's network of 350 dealers, and offers will be made to each of them to join PAG. Over the next two years, GM will continue under contract to manufacture three Saturn models for PAG - the Aura sedan and the Vue and Outlook SUVs. Penske has stated that his ultimate goal is a partnership with an off-shore manufacturer to produce Saturn-branded vehicles. Renault Samsung and Nissan have been mentioned, but Penske said there are a number of international automakers with "their hands up."

Penske's reputation as a successful business developer - Penske Automotive Group, Penske Motor Group, Penske Truck Leasing, Penske Racing, Penske Speedways, Ilmor Engines - surely played into the negotiations. In partnership with GM, he resurrected Detroit Diesel in the late 1980s, solidifying his reputation as a turn-around artist. Penske also has a current ownership stake in businesses involved in diesel engine manufacture, transportation logistics, commercial truck component manufacturing, internet brands and lighting. He has been a board member of numerous Fortune 500 companies and is currently on the board of General Electric.