Abu Dhabi soveriegn fund Aabar's move to buy a 9.1 percent stake in Daimler in a return for €1.95 billion ($2.65 billion) in fresh capital isn't just a boost for the premium automaker. It could restore confidence in Germany as an industrial location at a time of economic crisis, write German commentators in an outpouring of unanimous praise for the deal announced on Sunday night.
Daimler is receiving ugently needed liquidity and a strong, long-term partner at a time when its share price is so low that's it's at risk of a hostile takeover, according to editorials in Germany's leading newspapers on Tuesday.
Abu Dhabi is effectively saying that it believes Daimler has a future despite its sliding car sales. Commentators also say the stake is a negative signal for ailing automaker Opel, which has yet to attract investors to help it stave off insolvency.
The conservative newspaper Frankfurter Allgemeine Zeitung writes:
"At a time when other automakers are in deep trouble and calling for state aid, Daimler too has financial problems and needs liquid funds as well as a strengthening of its equity base. Daimler's current difficulties come in handy for the investment company Aabar from Abu Dhabi because it has enabled them to invest at a bargain price."
"The investors aren't put off by the current miserable sales figures. They have a far more long-term approach. They know full well that oil reserves are finite and that their classic source of income will soon dry up. Even if not a single car drives on gas or diesel in 20 or 30 years, Daimler should go on earning good money with nice cars."
Mass-circulation Bild writes:
"Is this the sellout of our industrial pearls that are suddenly available at bargain prices in the crisis? Will the most German of all brands turn into Abu Daimler? No! Anyone who listens to such fears is mistaken."
"The sheikhs' investment is worth more than any star of a credit rating agency. In the midst of the crisis, it's praise for Germany as an industrial location. For the products and the people who build them. Companies like Daimler that get capital now -- for example to develop new, better cars -- will soon overtake the rest of the sector. That saves and creates jobs in Germany -- more than any state stimulus program financed by the next generation. The sheikhs can't chase off the crisis. But they can instill hope in the future."
Conservative Die Welt writes:
"If the German economy minister hasn't sent a thank you letter to Abu Dhabi yet, he should do so immediately. The emirate's sovereign fund is backing automaker Daimler with €2 billion, less than a year after foreign sovereign wealth funds were stigmatized by a new law. True, the price of 20 euros could turn out to have been a snip. But the Arabs may be sparing the government a task it would scarcely have been able to perform."
"The oil sheikhs of all people are helping Daimler to invest in the future: in electrical cars without which no automaker will be able to survive."
"Investments from the Arab region aren't new but they nevertheless show how fundamentally the global economy has changed, and from where the impetus for a reversal of the fatal trend of recent months could come. It's the sheikdoms, and China, that have built up billions in currency reserves and could now bring about an important psychological turnaround in markets. Maybe Abu Dhabi's investment in Daimler is such a signal."
"Given Daimler's good fortune, the government should think once again about how deeply it wants to get involved in Opel. If neither private investors nor sovereign funds regard a rescue as possible, that would be a clear signal. If this signal is ignored, it would be very likely that tax monies would end up disappearing into a black hole."
Business daily Financial Times Deutschland writes:
"There's much to suggest that Zetsche is less interested in a strategic partnership than in the €2 billion in fresh capital the Arabs have already transferred to Stuttgart. Daimler's net liquidity fell to ominously low levels last year as a result of the unprecedented auto crisis. In addition, Zetsche can use an anchor investor to shield the premium manufacturer, which is now available at a bargain price, against a hostile takeover."
"The decisive factor for Zetsche is that Aabar isn't demanding anything unpleasant in return for its investment. The sheikhs want more of a say than their neighbors in Kuwait, which have held a stake in Daimler for decades. But they have given assurances that they don't want to get involved in the day-to-day running."
"The investment is also a good deal for Aabar. Daimler is a valuable brand that is strongly undervalued on the stock market. And there can be no doubt that the company will survive the crisis, contrary to some of its competitors."
Business daily Handelsblatt writes:
"The company's reserves have been depleted as a result of its totally contradictory strategies over the last 20 years. The 'integrated technology company' of Edzard Reuter and Jürgen Schrempp's 'World AG' devoured billions. If Zetsche really achieves the breakthrough in electrical mobility in cooperation with the desert state, he will enter the history books as Daimler's savior."