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.

Friday, October 28, 2011

Deal to sell Saab to China announced

It has just been announced that Swedish Automobile has agreed to sell all shares in Saab Automobile AB and Saab Great Britain Ltd to Chinese companies Pang Da and Youngman for the amount of EUR 100 million. This means that Saab will be fully Chinese owned. According to Saab's CEO, Victor Muller, the Chinese are ready to invest at least EUR 500 million in Saab.

"This is very pleasing for all employees at Saab," said Executive Director Communication Eric Geers to TTELA.

"I feel very happy about this. Now the future of the company is secured. The future looks very bright now. Now we have the deepest pockets on board, which will make sure that the company will prosper," Victor Muller said.

Here's an radio interview with Victor Muller (in English):

Lyssna: Victor Muller om att Saab blir kinesiskt

Here 's the press release:

Trollhättan, Sweden: Swedish Automobile N.V. (Swan) announces that it entered into a memorandum of understanding with Pang Da and Youngman for the sale and purchase of 100% of the shares of Saab Automobile AB (Saab Automobile) and Saab Great Britain Ltd. (Saab GB) for a consideration of EUR 100 million.

Final agreement between the parties is subject to a definitive share purchase agreement between Swan, Pang Da and Youngman, which will contain certain conditions including the approval of the relevant authorities, Swan's shareholders and certain other parties. The consideration of EUR 100 million will be paid in instalments. An important consideration for Swan to enter into the transaction is the commitment of Pang Da and Youngman to provide long term funding to Saab Automobile.

The administrator in Saab Automobile's voluntary reorganisation, Mr. Guy Lofalk, has withdrawn his application to exit reorganisation. The MOU is valid until November 15 of this year, provided Saab Automobile stays in reorganisation.

As we can read from the press release, the request from Guy Lofalk to the court that the reconstruction of Saab should end, has been withdrawn.

Furthermore the sale of Saab to the Chinese is subject to approval from stakeholders such as shareholders of Swedish Automobile, Chinese and Swedish authorities, the European Investmen Bank and General Motors.

The opinion of the latter would probably prove to be the most interesting. General Motors holds preference shares in Saab and is licensing a lot of technology to Saab. When General Motors was selling Saab back in 2009, there were reports saying that the US company were not willing to sell Saab to a Chinese company due to the fear of spreading GM and other state of the art technology to China. But since then the world has progressed, Ford has sold Volvo to Chinese Geely and maybe even the old General will reconsider?

Of less importance Swedish Automobile and Saab also announced that they will issue a subscription notice for 3 million shares under the current EUR 150 million equity facility between Swan and GEM Global Yield Fund Limited. I guess money to pay wages and keep Saab going until November 15.