Spyker to appeal court dismissal of Saab suit vs GM

Article by Anita Panait, on June 22, 2013

Dutch sports car maker Spyker NV has disclosed that it will appeal a decision by United States District Judge Gershwin Drain of the US District Court for the Eastern District of Michigan dismissing its $3 billion lawsuit against General Motors Co. Spyker has accused GM of trying to collapse Swedish carmaker Saab.

Saab said that after a “careful review” of the ruling of the district court, it decided to make an appeal. In dismissing Spyker’s lawsuit, Judge Drain said on June 10, 2013, that GM had a contractual right to approve or disapprove the proposed sale of Saab to Zhejiang Youngman Lotus Automobile Co.

Saab halted production in May 2011 when it lost ability to pay suppliers and it workforce. For several months, Spyker and former Saab CEO Victor Muller had attempted to implement a rescue agreement with different investors from Russia, Middle East and China, which include Youngman and Pang Da Automobile Trade Co Ltd. The rescue agreement with Youngman, however, failed to push through after General Motors, Saab’s former owner, declined to approve the sale. This eventually resulted in Saab being declared as bankrupt. Saab declared bankruptcy in December 2011, less than two years after GM sold the carmaker to Spyker.

The Dutch sports car maker filed a case against GM in August 2012, seeking damages and accusing GM of trying to ruin the deal with Zhejiang and get rid of a potential rival in China.

GM had said that it legally had the right to give approval to Saab's contract with China's Zhejiang Youngman Lotus Automobile Co. Previously, GM said that the lawsuit filed last month by Spyker didn’t have merit.

On the other hand, Spyker asserted that GM, which has operations in China in a partnership with state-run automaker SAIC Motor Corp Ltd., effectively averted deals with Pang Da and Youngman. In the lawsuit, Spyker said that GM's actions to terminate any sale were made to take out a possible rival in China. GM said that it will halt the supply of vehicles and technology to Saab's new owners since it would be against its shareholders’ interests.

In January 26, 2010, GM disclosed that it reached an agreement to sell Saab to Spyker subject to regulatory and government approval. The sale was finalized on February 23, 2010. Under the deal, GM would continue to supply Saab with engines and transmissions, as well as completed vehicles in the guise of the new Saab 9-4x. The agreement included a loan from the European Investment Bank, as guaranteed by the Swedish government. It included $74 million in cash up as payable to GM as well as shares in Spyker worth $320 million.

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Topics: spyker, saab, gm, lawsuit

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