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.

Sunday, June 26, 2011

Union representatives now in power of Saab

Updated/corrected because of uncertainty if the Board can file for bankruptcy without the approval of the shareholders

Swedish Göteborgs-Posten reports that on 23 June Kristina Geers, Saab's General Counsel, resigned from the Board of Directors of Saab Automobile. Remaining on the Board are Victor Muller as Chairman and one representative from the union IF Metall and one from the union Union. In other words, at the moment the unions are in majority of the Board and thus can decide the fate of the company.

As far as I can understand, this puts yesterdays reports that the unions threaten to force Saab into bankruptcy proceeding into another light. When a company is insolvent, the members of the Board should file for a bankruptcy. So not only do the unions threaten to force Saab into bankruptcy, they can also be obliged to file for bankruptcy through their role as Board members.

When Håkan Skött, representative of IF Metall, was asked by Göteborgs-Posten if the unions are in power to govern Saab, he said the following:

"That's how it is. We have that opportunity. There is no difference between a union member of the Board and someone else. If there's an issue for which we vote for or against and Victor are voting the other way, then we are the ones who decide. That's how it is."

 Håkan Skött, IF Metall
Hopefully the unions will not have to vote for bankruptcy. There are still hopes that the property deal can be finalized. Yesterday Jens Engwall who is the CEO of Hemfose, the leading company in the consortium which wants to buy Saab's property, told Göteborgs-Posten that on their part everything was ready to finalize the purchase of Saab's property. The missing pieces are according to Engwall "the European Investment Bank loan and a little money from Pangda and Youngman."

"For me, as a normal real estate person, it is a very complicated deal." he continued, and if Saab was heading for collapse  Engwall said  "we, perhaps, wouldn't buy the property at the current juncture".