GM’s ailing Swedish subsidiary has been in contact with 20 potential buyers, up from five announced early last month. Saab’s lawyer said a sale is expected by June. The interested parties include investment companies and industrial firms from all over the world. However, no companies have been named specifically.
Saab entered bankruptcy protection with the Swedish government on February 20. The company has been going through a restructuring process with the intention of becoming an independent entity. In a court hearing today the carmaker’s creditors were given a chance to come forward and challenge the restructuring process. Luckily for Saab, all agreed to let the process continue.
Therefore, the court ruled to extend Saab’s bankruptcy protection until May 20. Saab has said it will apply for a further extension. The company plans to start negotiations with creditors in June. It must reduce its debt of 10.6 billion kronor ($1.3 billion) by 75 percent. It expects to pay the remaining 25 percent by the end of the year.
Saab has been told by the Swedish government, that it will not receive any aid until it breaks free from GM. GM has declared that it will only continue to fund Saab until the end of the year. Meanwhile, the automaker needs about $1 billion in financing. It expects to receive $600 million from the European Investment Bank and the remaining $400 billion from GM. Part of the money will come from writing down some of the $1.2 billion debt owed to GM and part will come from supplying tools for manufacturing Saab’s new car models.
Source: The Detroit News