Mon 19 Dec, 2011 12:00 pm
I'm sad to read this because I had Saabs for several years. It's a great car. ---BBB
December 19, 2011
Saab Files for Liquidation
By DAVID JOLLY - New York Times
PARIS — Saab Automobile threw in the towel on Monday, filing for liquidation after its hopes of receiving a life-saving investment from Chinese investors collapsed in the face of opposition from its former owner, General Motors.
Saab and two subsidiaries filed with the District Court in Vanersborg, Sweden, according to a statement from Saab’s parent company, Swedish Automobile. The parent “does not expect to realize any value from its shares in Saab Automobile,” it said, “and will write off its interest in Saab Automobile completely.”
Viktor Muller, a Dutch entrepreneur who had previously been chief executive of a sportscar maker, Spyker, acquired Saab from G.M. in January 2010 for $74 million in cash and $326 million in preferred shares. But he was unable to obtain the financing he needed to modernize the Saab line-up at a time of global financial turmoil.
Mr. Muller’s efforts to keep the company afloat became increasingly desperate after suppliers stopped extending credit last spring, forcing a halt to production at the company’s main plant, in Trollhattan, Sweden.
Saab’s unions began legal proceedings in September that could have led to the company’s liquidation, and Mr. Muller responded by voluntarily seeking court protection from creditors.
In a last bid for survival, Saab had been trying to arrange an infusion of cash from Chinese investors, including Zhejiang Youngman Lotus Automobile.
But General Motors, which retained an effective veto on any deal because it holds key Saab patents, refused to back the arrangement , fearing it would “negatively impact G.M.’s existing relationships in China.”
Stefan Lofven, head of the I.F. Metall union, called in a statement for the government to help Saab workers find new jobs. He also called on Saab’s administrator to quickly arrange a sale of the company as a single unit, so as to keep it functioning as a coherent business.
However, despite a famously loyal group of customers, Saab has only reported a profit once in the last two decades, and the fact that all of the global automakers have ignored it suggests a different fate ahead. Analysts expect the company, which began selling cars in 1949, to be broken up and sold piecemeal.
“There’s not much left to salvage,” Anders Trapp, an auto industry analyst at S.E.B. in Stockholm, said, noting that Saab’s customer base had been dwindling as the problems grew. “Maybe the brand will continue in some form, but there’s not much left of it anymore.”
On Dec. 7, Guy Lofalk, the administrator appointed by the Swedish court to oversee the voluntary reorganization, said it was time to call a halt as there was no reason to think Saab could survive.
In its statement, Swedish Automobile said that Youngman, having considered G.M.’s position, “informed Saab Automobile that the funding to continue and complete the reorganization of Saab Automobile could not be concluded.”
“The board of Saab Automobile subsequently decided that the company, without further funding, will be insolvent, and that filing bankruptcy is in the best interests of its creditors,” it said. “It is expected that the court will approve of the filing and appoint receivers for Saab Automobile very shortly.”
In a text message Monday, Mr. Muller said he would hold a press conference “as soon as the court has ruled.”