Saturn Corp. plans to form a publicly traded company built on the assets of 75 to 150 Saturn stores.
The GM subsidiary disclosed its plans last week in a series of meetings with dealers in Charlotte, N.C.
According to two dealers who attended, Saturn itself would be a minority partner in the new company, which most likely would launch an initial public offering late next year.
Saturn crafted the plan to help dealers who want to sell their stores but are having trouble finding qualified buyers. The plan also helps Saturn dispose of 29 stores that it already has purchased from dealers.
The company will be called Saturn Retail Enterprises and will be based in Charlotte. Dealers who choose to participate will be given equity in the new company in return for their stores. They can continue working at the stores if they sell.
Saturn told dealers they must decide this month whether to participate. Saturn spokesman Bill Betts declined to comment on the proposed spinoff.
Moss Adams LLP, an accounting firm based in Seattle, will evaluate the worth of each store. Dealers can accept or reject that evaluation; haggling is not allowed.
Saturn offered dealers various scenarios for a spinoff of at least 75 and up to 150 stores. Assuming that the average Saturn store generates annual revenues of $25 million, a 75-store company would generate sales of $1.9 billion.
Saturn has 388 dealerships, so the proposed company would control a minimum of 19 percent of the brand's stores.
Saturn has not yet announced the new company's leadership. However, the division told dealers that the chief executive and CFO most likely would be drawn from Saturn's corporate ranks. The COO would be someone with retail experience.
Merrill Lynch is advising Saturn on this project.