Saab keeps legal protection from creditors

Article by Christian A., on November 9, 2011

For the meantime, Saab can still be legally protected from creditors, according to the court-appointed lawyer that oversees a reconstruction process for the automaker. This comes after General Motors Co. denied a Chinese bid to take over Saab. Last Monday, GM said that it will halt supplying parts and technology to Saab if the two Chinese companies successfully acquire the Swedish company.

This statement mirrors GM’s hardening stance to oppose the proposed sale of Saab. It also casts doubts on the survival of the niche brand, which was under court protection from creditors since September.

In a Reuters interview, court-appointed administrator Guy Lofalk said that the company will seek some clarity on the implications of GM’s decision.

He makes the decision on when he will file a motion to the court to put a stop to the bankruptcy protection process. Lofak revealed that talks have started between the Chinese investors and Swedish Automobile, which owns Saab.

The Chinese investors are Pang Da Automobile Trade Co. and Zhejiang Youngman Lotus Automobile Co. Last June, Youngman and Pang Da entered a deal to acquire a combined 54-percent stake in Saab's owner Swedish Automobile.

However, Saab’s position is getting worse and liquidation a huge risk. This is why the two investors had made an offer last October to buy Saab outright for 100 million euros ($141 million). [source: Autonews]

Topics: saab, sweden

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