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.

Monday, May 16, 2011

Spyker Cars utilizes GEM facility

Spyker Cars today issued a press release stating that Spyker has issued a subscription notice for 1 million shares in Spyker Cars under the equity facility agreement between Spyker Cars and GEM Global Yield Fund Limited.

As far as I can tell, this means that Spyker is raising around EUR 4 million by issuing and selling shares to GEM. This is a costly way to raise money as it does two things. First, it dilutes the value of the shares of the existing shareholders, and secondly, GEM is allowed to buy the shares with a discount.

Let's hope this is a one time occurrence as soon as that the deal with Pangda Automobile is finalized.

PS: If I have misunderstood the subscription notice, then I would appreciate your correction in the comments.