SvD summarize the recent events and answers common questions

One of the Swedish reporters I have come to respect the most regarding his reporting on Saab, is Jonas Fröberg at Svenska Dagbladet. He is a tough reporter, he doesn't hide the truth, but he doesn't overdramatize either. Today he has written a good summary of the recent events and he tries to answer to most common questions. Here's a translation:

"If Saab is to survive, the factory must get up and running"

The European Investment Bank, EIB, places high demands on Saab if Saab is to sell their factory to raise money - but what does it mean? SvD Business reporter Jonas Froberg explains the concepts. 

What does the EIB's new requirements mean? 

 - If it really is true that Saab’s loan with the EIB must be terminated and repaid within 90 days,  the situation will get  very difficult for Saab. The Trollhättan company has to up till now borrowed 217 million euros (about SEK 1.9 billion) from the EIB for specific development projects. Ironically, Saab really want nothing more than to get rid of the EIB loan, but in the short term it will be very difficult to get new loans elsewhere. It also means that the EIB and the Government must approve Vladimir Antonov as owner - he has promised to invest almost half a billion Swedish kronor. But it that’s not enough.

Doesn’t Saab negotiate with Chinese car companies?   

 - Yes, it was confirmed by Victor Muller to SvD Business report on Thursday. It can be a solution, but nothing is clear and the time frame is tight.

Can Saab go bankrupt because of this?

 - If the National Debt Office's tough requirements [I think this is a typo and it should be EIB] really is true and they won’t reconsider - and Saab cannot get financing quickly, then bankruptcy can happen. We must remember that for Saab to survive, they must get the factory up and running again. Saab is losing big money every day it's shut down.

Why does the EIB set so tough conditions?

 - That's the big question. We can currently only speculate on the EIB's motives. Perhaps they no longer believe in Saab. Maybe they do not want to do business with Saab if Vladimir Antonov is on board, but the really remarkable thing is the method. Let us remember that the Government and the National Debt Office in fact, after several considerations, agreed that Saab can sell the factory to Vladimir Antonov to quickly raise money. The EIB must tell us about their motives. Otherwise the situation will get unbearable.

What does all these back and forth mean?

 - That the Government, the EIB, the National Debt Office and GM do not seem to have talked to one another at all. It seems, to say the least, unprofessional. It's one thing to deny Saab to go through with the sale, but then they have to do it in a professional manner, dare to face the consequences and make it time efficient. The EIB set new conditions just minutes before the bank closes for the Easter weekend - while the Government made a large number in the media of the fact that they endorse the sale - it is nothing short of unprofessional. Add to that the head of the National Debt Office, Bo Lundgren, who at the same time goes publis in the Daily News and start throwing pies at the EIB, which he thinks is too bureaucratic. Simply unprofessional. Those prone to conspiracy can see it as if Saab would go under due to all this, then the Government can blame the EIB which is located far away down in Luxembourg.

What is the background?

 - Saab must raise money quickly. The company has run into a liquidity crisis because they were selling too few cars. Since Saab can not pay all suppliers,  the production in Trollhättan has been stopped for several weeks. Now they must get the factory started. Fast. But Saab has a very big loan in the EIB - a loan of EUR 400 million of which Saab has drawn EUR 217 million. The EIB loan is tied up in various development projects and can not be used to pay daily bills. Everything of value is pledged.

 That is why Saab wants to reduce the EIB loan from EUR 400 million to 280 million. Then Saab wants to release values ​​and can sell the factory in Trollhattan to Vladimir Antonov. All of this is the first step to solve the financial crisis at Saab. The second and longer-term step is to let Antonov become part owner. In the latter case, the National Debt Office has so far not been successful in making an appointment  with Vladimir Antonov, who, strangely enough, was out travelling this week. They will meet early next week.

Who are supposed to approve of what?

 - The whole process has become more complicated and strange during the Easter weekend. The first step - the transaction - must be approved by the EIB, the Government which has previously received a recommendation from the National Debt Office. But then the second in command at the EIB, Eva Srejber, claimed that even GM must approve the arrangement, which was news to everyone else. Saab claims that GM has already approved it.

The second step - to approve Antonov as owner – is to be approved by four parties:  the EIB, the Government, the National Debt Office and GM. Where all have the power of veto.

What happens now?

 - Probably nothing of importance will during Easter Monday. But on Tuesday the EIB must tell everybody why they do what they do. At the beginning of the week the examining to see if Antonov can become owner of Saab  is also supposed to be completed. This coming week will simply determine Saab's future.