BUYOUTS: Saab Lands a Rich American

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There's nothing like teaming up with a $100 billion company to improve one's prospects. Or so Swedish automaker Saab-Scania AB hopes. Saab last week agreed to sell General Motors a 50% interest in its car-making operations, which had 1988 sales of $2.6 billion, for some $600 million, plus a promise that GM will invest another $100 million. Saab, which also makes trucks and aircraft, will spin the auto holdings into a subsidiary to carry out the deal.

GM was a latecomer to the Saab wooing game, which began when Ford started courting the company earlier this year. After the collapse of those negotiations, auto-industry analysts expected Italy's Fiat to be the winning suitor. For Saab-Scania, which lost $123 million on its car-making operations in the first half of 1989, the advantage of the deal was access to GM's deep pockets. GM will gain badly needed production capacity at Saab's five plants in Europe, plus a stronger position in the U.S. and European luxury-car markets.