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Saab Wins Chance to Reorganize

Appeals courts accepts plans.

by on Sep.21, 2011

Image By: Len Katz

Saab boss Victor Muller now has 90 days to get the company's finances in order.

A Swedish appeals court has given Saab what amounts to a reprieve, a chance to raise cash and pull its finances into order rather than plunge into a bankruptcy process many believe would result in the closure of the long-troubled automaker.

The decision for the Court of Appeals for Western Sweden reverses an earlier court decision rejecting Saab’s request for a 90-day window in which it would be protected from creditors that include key parts suppliers as well as more than 3,000 Swedish workers.  The reorganization process is somewhat similar to an abbreviated version of the American Chapter 11 bankruptcy filing.

Saab officials have repeatedly said they eventually plan to pay off all of their outstanding debts in full.  But the cash-starved maker is waiting for two proposed Chinese deals to wend their way through that country’s labyrinthine bureaucracy.  In the meantime, Saab has received a $96 million bridge loan it hopes to apply to some of its bills and operational costs until the alliances with China’s largest auto distributor Pangda, and automaker Zhejiang Youngman Lotus Automobile are approved.

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It does not appear likely, however, that the maker will yet be able to re-open the headquarters assembly plant, in Trollhattan, that has been shuttered since suppliers began a boycott in late March.

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Saab Readying to Re-Start Production

Russian bailout may not solve all problems for Swedish maker.

by on Apr.18, 2011

The Saab assembly plant, in Trollhattan, has been shut down for two weeks due to a supplier boycott.

With new funding coming and reluctant suppliers now beginning to ship parts again, Saab’s headquarters plant could be up and running in a matter of days, according to company and industry sources.

Operations at the maker’s Trollhattan, Sweden factory ground to a halt, two weeks ago, when parts makers staged a boycott demanding Saab follow up on unpaid bills.  Despite company claims that there was still more than $200 million in the bank, the move set off a frantic search for more capital.  Russian banker Vladimir Antonov then offered to assist by buying up Saab’s assets and leasing them back to the troubled maker.

On Friday, Swedish Enterprise Minister Maud Olofsson announced the government had decided “to conclude an agreement with Saab” that would help it get past a cash crunch triggered by slow sales last year.

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The deal would allow the asset sale to Antonov, who controls a number of banks in the former Soviet block, including Bankas Snoras, in Lithuania.  Antonov was a one-time partner of Saab Chairman Victor Muller who purchased the Swedish carmaker from General Motors in early 2010.  Muller, a Dutch entrepreneur, got into the automotive business, a decade ago, by founding a low-volume sports car company, Spyker.  But Antonov was forced out because GM declined to do business with the Russian.

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