Bank says that Saab needs GM’s approval to raise the funds

Article by Christian Andrei, on April 25, 2011

The deal that would enable Spyker Cars to raise the funds it needs for subsidiary Saab will proceed only with the approval of General Motors Co., which is Saab’s former owner and a current shareholder, Vice Chairman Eva Srejber of the European Investment Bank told Swedish newspaper Dagens Industri.

She disclosed that the bank has agreed with the deal in principle with Spyker for Saab to sell and lease back real estate to ease liquidity problems, provided that GM will give its approval.

In addition, Srejber stated that it is not enough to make statements, and Saab must have formal approval from GM for the agreement to move forward. Saab’s operations have been halted for more than two weeks due to unpaid bills to its suppliers.

Although the EIB has agreed to the deal, Spyker has expressed its objection to the conditions that the bank has set. Saab wants to sell its real estate to Russian businessman Vladimir Antonov, and this scenario will allow Saab to obtain cash that will be used to pay the overdue bills.

One of the “tough” conditions is that Saab will repay its existing loans within 90 days of the sale, and that the agreement would only involve a partial sale of Saab property only.

Moreover, the bank is seeking further details and formal approvals from the Swedish government, the Swedish Debt Office, Saab Automobile and GM. Spyker has expressed concern over the matter stating that it is not yet sure whether these approving entities will be able to satisfy the conditions that the bank has set and to proceed with the sale of Saab’s property in the shortest possible time.

Topics: saab, gm

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