GM readying books on Hummer

By Jui Chakravorty Das

NEW YORK (Reuters) - General Motors Corp (GM.N: Quote, Profile, Research, Stock Buzz) expects to give potential buyers financial information about Hummer in the next few weeks while also looking at other asset sales, Chief Operating Officer Fritz Henderson said on Monday.

GM, which in June hired Citigroup to consider all strategic options for Hummer, has not yet officially put the iconic gas-guzzling brand on the market.

Even as GM executives have publicly said they have received indications of interest in the brand, likely buyers from India, China, Russia and the Middle East have denied interest.

A credit crunch that began last summer has severely limited access to borrowing money, especially for private equity players, making large deals very difficult.

"Private equity, which was a source of capital, has really curtailed its appetite with concerns about credit," Henderson said at the Reuters Autos Summit in Detroit. "Ultimately someone has to buy assets in order to sell them, and there has been a dearth of buyers."

Still, Henderson said GM was not delaying the sale process of Hummer to wait out the downturn. "I would like to reach a conclusion on this relatively promptly because taking a lot of time doesn't help."

Henderson said there was no deliberate delay and that the auction had not yet begun because "doing stand-alone financials takes time."

While he said he would like to see a decision on Hummer by the end of the year, he does not see a sale closing before 2009.

TOUGH SALE

Interest in buying a brand that gets only 9 to 15 miles a gallon has been scant and continues to shrink as gasoline prices squeeze drivers worldwide and environmental concerns increasingly trump any other notion of what's cool.

Sources familiar with the matter have said GM has had initial exploratory talks about Hummer with Indian automaker Mahindra & Mahindra Ltd (MAHM.BO: Quote, Profile, Research, Stock Buzz) and Russian oligarch Oleg Deripaska.

But both parties have publicly denied interest.

Hunan Changfeng Motor Co (600991.SS: Quote, Profile, Research, Stock Buzz) also said it had held preliminary talks with GM, but the Chinese SUV maker backed off after touring Hummer's U.S. factory, citing limited potential to market the vehicle.

And after Terry Johnson, GM's managing director for the Middle East, said two investors in the Gulf Arab region had made overtures, the three most likely candidates -- Abu Dhabi's Mubadala, Kuwait's Investment Dar and Dubai Investment Capital -- denied interest.

"It's an interesting and iconic brand, and our timing was poor," Henderson said, referring to GM's launch of the Hummers in the U.S. market.  Continued...