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Monday, May 2, 2011

End of the Saab finance drama ?


As many knows Saab had many troubles with financing of the production in the last weeks and the Saab executives are hard working to secure the money. Two interesting press releases from today (2.5.2011) are indicating, that this comes to an end.

The first - Saab Automobile secures short-term funding, says that Saab is entering into a 30M€ convertible loan agreement with Gemini Investment Fund Limited. Gemini owns a minority of Spyker Cars (owner of Saab) already, but who are the owners of Gemini is unknown. Speculations, that it is the russian enterpreneur Vladimir Antonov  are unconfirmed. 

"An addition to the receipt of EUR 30 million from Gemini, Saab Automobile will make a drawdown request to the EIB for an amount of EUR 29.1 million. As a result of the convertible loan and the EIB draw down - which is expected next week – Saab Automobile secured an amount of EUR 59.1 million. With the receipt of these funds, Saab Automobile secured the liquidity that is required to restart production."  

Regarding the mid-term financing, Spyker came into a 150M€ agreement with Hawtai Motor Group which allows them to gain up to 29.9% equity stake in Spyker (120M€) + 30M€ convertible loan for 6 months, which could be another Spyker shares. Since this is a strategic partnership it will allow Saab to enter chinese markets and most probably use clean diesel engines from Hawtai, which are licensed from VM Motori. Hawtai owns 2 production facilities in Asia and will most probably use Saab technology. Further details they will announce later.

The transactions are subject to agreement on definitive transaction documents and certain conditions, which include consents from certain Chinese governmental agencies, the European Investment Bank and the Swedish National Debt Office. This will take some time and hopely not too much trouble.

Good or bad ? Well, it could be much worse. Saab could be dead at this stage. It's not. Also it could be a total buyout by Hawtai or some other chinese auto maker, which could lead to dead of the brand. This agreement seems to be a partnership. Hawtai is interested on technologies know-how, Saab/Spyker is interested on chinese market and chinese distribution network. That is a far better fit than dead. From shareholders point of view a good restart with good sales perspective. From Saab enthusiasts point of view it is a way to save Saab (again). Unless the quality remains (or increases) and this partnership does not change the way Saab started after independence from GM, fine. The ownership structure would be Gemini 29.9% (some sources say, this is Vladimir Antonov, some says it isn't),  Hawtai 29.9% and than the rest.

Am I happy ? I have mixed feelings but really it could end much worse. 

Good luck Saab.

sources :,

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