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Saab Gets Another Reprieve

Chinese come through with $97 million bridge loan.

by on Oct.14, 2011

The bridge loan might just let Saab restart assembly operations next month.

For anyone disappointed to see soap operas vanish from American television there’s always the Saab saga to fall back on.

Just days after is seemed the maker was going to be forced into an involuntary bankruptcy it has been given at least another temporary reprieve, it has received the first installment of a $97 million bridge loan from one of the two Chinese companies looking to eventually buy a controlling stake in the struggling Swedish automaker.

Automaker Zhejiang Youngman Lotus reportedly has cut a $15 million check for Saab and should have the full $97 million deposited in the troubled Saab’s bank account within the next week or so.  It had appeared increasingly likely that the Chinese carmaker and China’s largest auto dealer, Pang Da, were not going to get approval from Beijing regulators to complete their acquisition of a majority stake in Saab.  With no new sources of cash, the Swedish maker would have been forced into what likely would have been the break-up of the company.

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The new loan should help Saab cover at least some of its bills.  It owes millions to 3,600 Swedish employees – which prompted their unions to try to force Saab into bankruptcy.  But it also owes millions to key suppliers.  Those partsmakers have been boycotting the company since late March over unpaid bills.  As a result, Saab hasn’t produce any cars at its headquarters plant in Trollhattan for more than six months.


With $96 Mil in Hand, Saab Hopes to Avoid Bankruptcy

But unpaid workers could push maker into insolvency.

by on Sep.13, 2011

Saab's assembly line has been idled since March due to a supplier boycott.

With a $96 million bridge loan in hand, Saab is desperately hoping to keep itself in business, but it may be too late for the struggling Swedish carmaker, its employees asking the courts to push the brand into bankruptcy.

Saab is asking a Swedish appeals court to reverse last week’s decision by a district judge to reject its reorganization plan – a move that, in Sweden, would give it 90 days to work out a way to pay off its bills.  And it owes a lot of folks money, including not just some of its key suppliers but also 3,700 Swedish employees who weren’t paid last month.

After also experiencing delays in their June and July paychecks, two unions have filed for bankruptcy, something workers are permitted to do in Sweden, though “This is not a situation that any member of Unionen wishes to be in,” Cecilia Fahlberg, chairwoman of one of the two unions, insisted after taking Saab to court.

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The move came hours after Saab found ways to raise $96 million through a complicated deal with Specialty Purpose Vehicle, an apparently newly-formed organization that seems to be linked to one of the Chinese companies, Zhejiang Youngman Lotus Automobile, that has been trying to secure permission to purchase a majority stake in Saab.


$157 Mil Bank Deal May Save Saab

Meanwhile, Saab owners halt sale of Spyker sports car unit.

by on Sep.02, 2011

A partially assembled Saab sits on the line in Trollhattan. The plant has been shuttered since late March.

Cash-starved Saab Automobile is close to landing a $157 million bank loan that could help it steer clear of bankruptcy, according to reports.

The deal, if completed, would provide enough cash to cover current salaries, pay off angry suppliers who’ve been threatening to force the carmaker into foreclosure and possibly even get the maker’s headquarters assembly plant, in Trollhattan, Sweden, running again for the first time since suppliers began boycotting Saab in late March.  But as with a variety of other rescue efforts, it is taking longer than expected to lock down the billion-kronor loan.

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Saab’s situation has been steadily deteriorating since then despite the maker inking a variety of deals – including one with China’s largest auto distribution network, Pangda – which were supposed to raise the cash necessary to cover its bills.  One deal collapsed soon after it was announced, while most of the others have run into a miasma of regulatory delays that have kept much-needed cash out of Saab’s corporate coffers.

But in a surprise move, parent Swedish Automobile says it has suspended plans to sell its Spyker sports car subsidiary to the Russian banking tycoon Vladimir Antonov.  The $46 million deal was intended to raise cash and permit the company to focus on its larger, Swedish-based business.