Spyker Cars, the owner of Saab, has entered into a joint venture agreement with China-based Hawtai Motor Group for distribution, manufacturing and technology. This partnership will give Saab the opportunity to penetrate the vehicle industry in China with a market leader in manufacturing in the country, Saab Chairman Victor Muller, who is also chief executive officer of Spyker, said.
Saab, which has been forced to halt its operations when its suppliers refused to deliver components due to unpaid bills, will also receive funds of 150 million euros ($222 million) under the deal.
Muller is positive that the unique brand values of Saab based on its innovation-driven character, aviation heritage and Scandinavian origins will do very well in China.
Under the pact, Hawtai will invest 120 million euros for up to 29.9 percent equity stake in Spyker. A convertible loan with a six month maturity will comprise the remaining 30 million euros. The loan will have a conversion price of 4.88 euros per share and an interest rate of 7 percent a year.
Established in 2000 in the city of Rongcheng in eastern China, Hawtai is a small manufacturer of private SUVs and buses. It began building the Santa Fe and Terracan SUVs under its brand name and utilizing a Hyundai-licensed technology.
Last year, Hawtai sold 81,439 vehicles of the two SUV models, according to J.D. Power. It also began selling sedans under its own brand last year.
Hawtai Vice President Richard Zhang said in a statement that the partnership will give his company the opportunity to tap into innovative technologies as well as to make use of a global network, which would take decades for it to build.