Swedish Automobile still negotiating with Chinese companies

Swedish automobile (former Spyker) is trying another wriggle to get General Motors to accept the Chinese companies involvement and ownership stake in Saab. Wages for Saab staff have been again running late and Saab is still under court protection from creditors, with employee unions having filed bankruptcy claims over unpaid salaries and factory in Trollhattan remaining closed. Equity issuance in the summer had given temporary reprieve on that front for white-collar workers.

GM earlier effectively blocked the sale of Saab to Pang Da Automobile Trade and Zhejiang Youngman Lotus Automobile, saying it would not allow the two companies to use its technology. During its ownership of Saab from 1989 to 2010, GM supplied a lot of technology to Saab and it threatened to block existing technology licenses and stop supplying the new Saab 9-4x.

In the most recent proposal, Pang Da is out of the picture. Youngman and a Chinese bank would acquire just under 50% equity ownership stake in Swedish Automobile (apparently consisting of 20% for Youngman and just under 30% for the bank. In the earlier deal Pang Da and Youngman would have acquired the entire Saab brand. After Swedish Automobile agreed to sell its Spyker Cars unit to North Street Capital, Saab is basically what remains for Swedish Automobile. The shares in Swedish Automobile NV made a small bounce in Amsterdam Exchange today).

All of this is pretty confusing and conflicting media reports make getting accurate information difficult. As an example, some media reports said that the bank in question was Bank Of China but this was denied by Swedish Automobile’s CEO Victor Muller, saying instead the other party would be “a bank in China” but not Bank Of China Ltd. CEO Muller stresses that the outcome of negotiations is still uncertain. Pang Da may still also be interested but not in an indirect ownership via a Swedish Automobile equity stake, but only directly in Saab. A source with insight into the process tells Dagens Industri, that the risk for GM also blocking this latest solution is very high. Here is the very short statement from Swedish Automobile.