Saab Automobile Breakup Looms on Chinese Cash Limit, GM’s Snub of Venture

Discussion in 'Europe' started by hvactec, Dec 25, 2011.

  1. hvactec

    hvactec VIP Member

    Jan 17, 2010
    Thanks Received:
    Trophy Points:
    New Jersey
    By Ola Kinnander - Dec 19, 2011 12:17 PM ET

    Saab Automobile’s assets may be broken up and sold to pay debt as the unprofitable Swedish company ends more than six decades of carmaking following a bankruptcy filing.

    Saab Auto submitted the application at Vaenersborg District Court after a potential Chinese partner wasn’t able to provide funding while General Motors Co. (GM), a former owner, said it would block the proposed tie-up, parent company Swedish Automobile NV said today in a statement.

    “There’s no doubt this is the blackest day in my career,” Chief Executive Officer Victor Muller said at a press conference today at Saab Auto headquarters in Trollhaettan. The company’s workforce totals about 3,600 employees, including 3,400 in the southeastern Swedish town.

    Muller has been seeking funding for Saab since his Zeewolde, Netherlands-based company, then named Spyker Cars NV, bought it in February 2010 from Detroit-based GM, which was about to shutter the brand. Muller was in talks earlier this month with potential Chinese financial backers, including Zhejiang Youngman Lotus Automobile.

    The court said in an online statement that it accepted the petition and appointed two Gothenburg, Sweden-based attorneys, Hans Bergqvist and Anne-Marie Pouteaux, as administrators.
    GM’s Role

    GM, which still has a say in Saab’s strategy because of the carmakers’ technology ties, said on Dec. 17 that recent proposals for rescuing Saab were similar to earlier plans that it had rejected as being “detrimental to GM and its shareholders.”

    The U.S. carmaker “made it clear it would not approve of a transaction involving Youngman,” while difficulties with rules on transferring funds out of China prevented a financing deal, Muller said today.

    Muller said that he received “two or three” expressions of interest today from potential buyers, and that he’ll refer them to the bankruptcy administrator that the court appoints.

    “Although this may seem like the end, it is not necessarily so,” he said.

    Saab Auto traces its roots back to the establishment of aircraft manufacturer Svenska Aeroplan AB, which was set up in 1937 and began building cars 10 years later. The auto business was split off from the aerospace operations, now called Saab AB, in the 1990s, with GM gaining a 50 percent stake in 1990 and full control in 2000.

    read more Saab Automobile Breakup Looms on Chinese Cash Limit, GM

Share This Page