IMPORTANT NEWS: National Electric Vehicle Sweden has agreed to buy the assets of Saab Automobile and the sale is expected to be finalized during the summer.

Thursday, April 21, 2011

What's up with the EIB?

A couple of weeks ago we learned that Saab wanted to sell its properties to a company controlled by Vladimir Antonov and then lease back the properties. Since Saab's properties were used as collateral when the Kingdom of Sweden guaranteed Saab's EUR  400 million loan in the European Investment Bank, the Swedish National Debt Office and the Swedish Government had to agree to free the collateral on the properties before Saab can sell the properties. The Swedish National Debt Office said on Thursday last week that they had no objections and the Swedish Government supported the NDO's decision on Friday. The deal means that Saab can sell the properties under certain conditions, and at the same time Saab's loan in the EIB will be reduced from EUR 400 million to EUR 280 million. So far Saab has only drawn EUR 217 million.

During the weekend, Saab and the buyer sorted out the conditions and agreed on a deal. Saab then sent the paper works to the Government, the NDO and the EIB on Monday. The NDO looked over the deal and completed their work on Tuesday. They had no objections.

The EIB also received the paper works on Monday, but for some unknown reason, they still have not reached a decision. As noted above,  the Kingdom of Sweden guarantees Saab's loan in the EIB. In other words, for the EIB there is no risk involved. If Saab can't pay its loan payments, then Sweden will have to pay. But despite that there is no risk for the EIB, they have calculated a ridiculously high interest rate on the loan. They make good money on Saab. Now Saab wants to reduce the loan from EUR 400 million to EUR 280 million and the risk will still be nonexistent for the EIB. But despite this, the EIB have so far not reach a decision on if they approve of the sale of Saab's properties or not.

Earlier today the EIB claimed that General Motors also have to approve the deal and implied that they have not approved the deal yet. But Saab tells us that both Saab and GM has done their part, everything is now up to the EIB.

So what's going on with the EIB? Do they let the decision drag on just to show everybody that they also can stop the deal? Is this the usual speed, or lack of speed, that the European bureaucracy is working at? Do they even care that thousands of people, whose livelihood depends on Saab, are waiting for the decision?

If it's this hard to agree that a company can reduce the loan amount, then I fear how many weeks the EIB will use to decide if Saab can get new owners.