Saab delays a court decision on whether it continues to be protected from creditors

Article by Christian Andrei, on December 14, 2011

Saab’s motion to delay a court decision on whether it continues to be protected from creditors was granted. From Friday, the court hearing has been moved to Monday. This gives Saab additional time to finalize a funding agreement with Chinese investor Zhejiang Youngman Lotus Automobile Co. Ltd. The Swedish district court in Vanersborg will decide if Saab retains its court-supported reorganization.

In an interview with Automotive News Europe, Saab spokesman Eric Geers said that it has requested for this hearing so that it will have the chance to make its arguments and respond to the judge’s questions.

Guy Lofalk, the administrator tasked with the automaker's restructuring, last week requested that the court end the reorganization since Saab doesn’t have the money anymore.

Last Tuesday, Saab CEO Victor Muller said that Youngman gave the company got 3.4 million euros as a first payment. This is only a partial payment. Geers declined to say the full amount that Youngman intended to give but he said that talks with the Chinese investor are progressing.

He added that what Saab is currently working on is to pay salaries and the reorganization costs. Swedish Automobile, which is the owner of Saab, has entered a series of deals as it attempts to keep the automaker afloat.

However, the latest deal with Chinese investors was rejected by former owner General Motors, which owns the licenses for Saab technology.

For several months now, the output at Saab's plant in Trollhattan, Sweden, was halted because it was unable to pay its suppliers. The salaries of Saab’s workers due on Nov. 25 have also not been paid yet. [source: Autonews]

Topics: saab

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