Saab files for bankruptcy
After a troubled two-year struggle to secure adequate funding to carry on as an independent following its sale by General Motors, Swedish Automobile, parent company of Saab, has officially filed for bankruptcy. The declaration by Saab Automobiles N.V. directly impacts Saab Automobile AB, Saab Automobile Tools AB and Saab Powertrain AB. It came after a final series of negotiations with Chinese automaker Zhejiang Youngman Lotus Automobile fell through when GM -- which still holds a small percentage of stock as well as the right to block any potential transfer of ownership -- said no to the deal based on fears it could potentially compromise intellectual property rights. A General Motors spokesperson told the trade publication Automotive News that the firm was not convinced the proposed terms for a sale to Youngman would sufficiently protect the interests of either GM or its shareholders in this critical area. GM currently supplies a number of key powertrain components for the Saab 9-3 and 9-5 models.
According to Swedish Automobile's owner and acting CEO, Victor Mueller, this latest move proved a de facto death knell for Saab, which was purchased from a then-bankrupt General Motors in June 2009 when Mueller was the head of the Dutch boutique automaker, Spyker Cars. Despite grand plans for a brighter tomorrow, Saab's fate now appears sealed. With Youngman's concluding that no reorganization deal was possible under the circumstances, "the Board of Saab Automobile decided that the company without further funding will be insolvent and that filing bankruptcy is in the best interests of its creditors." It expects the Swedish courts to approve the filing and appoint receivers for Saab Automobile shortly.
While a last-minute miracle may be possible, the statement goes on to note that "Swan (Swedish Automobile N.V.) does not expect to realize any value from its shares in Saab Automobile and will write off its interest in Saab Automobile completely." This bankruptcy action comes after a year in which Saab Automobiles produced only about 11,000 cars. The main facility in Trollhattan had been largely idle since the spring when numerous suppliers stopped delivering components due to non-payment issues.