SWEDEN: Administrator could pull Saab plug after loan no-show
The administrator in charge of Saab's restructuring under court protection could pull the plug on the process as early as today (Tuesday 11 November), paving the way for declaring the automaker bankrupt, Swedish daily newspaper Svenska Dagbladet has reported.
Citing sources with knowledge of the process, the paper said Saab still had not received a bridge loan of EUR70m (US$96m) that was secured by Chinese car firm Youngman, Reuters reported.
Separately, British car magazine Autocar said the last minute rescue was virtually certain to be blocked by the Chinese government meaning the company is almost certain to be declared bankrupt – possibly as soon as later today.
In addition to the short-term loan, Saab is waiting on the Chinese government to approve a further GBP210m investment in Saab by Chinese car firms Zhejiang Youngman Lotus Automobile and Pangda.
However, Autocar said the Chinese government is unlikely to ratify any investment or takeover of Saab as the sale does not include the acquisition of any new intellectual property rights. Former Saab owner GM already has a deal with its Chinese partner firm SAIC for the Epsilon platform used by Saab.
The magazine said the Swedish reports suggest the administrator handling Saab's restructuring under court protection could pre-empt the Chinese government decision, which is not expected to be made formal until the end of this week at the earliest, and declare Saab bankrupt later today.
The Swedish government has already stated it won't bail Saab out.
Saab has run out of cash and for the restructuring process to proceed it needs to be able to pay wages after a state salary insurance scheme runs out on 21 October, Reuters noted.
Should the administrator call an end to the restructuring process, the court would likely declare the company bankrupt.
The paper said negotiations were ongoing in the Swedish capital with Youngman but the court-appointed administrator could decide as early as Tuesday to ask a court to end Saab's period of protection from creditors.
The administrator, Guy Lofalk, could not immediately be reached for comment.
Saab spokeswoman Gunilla Gustavs told Reuters the car maker still expected to get the bridge loan.
"We are still expecting the Youngman loan to come in," Gustavs said. She had no comment on when the money was expected or how long Saab could last without the cash.
If the restructuring process looks unlikely to succeed, Saab's creditors, the administrator or Saab itself could ask for creditor protection to be withdrawn, Cecilia Tisell, a judge at the local court told Reuters.
She said the court had not received any request of that kind.
"No, we have not heard anything like that at all from the Saab companies or Guy Lofalk," she said.
Saab owner Swedish Automobile's chief executive Victor Muller declined to comment.
Swedish Automobile has struggled for months to stave off collapse, seeking new investors and selling off various assets so that it could pay suppliers and employees and resume production at its Saab plant in Sweden.
Saab had hoped protection from creditors would allow it to survive until China's authorities approve a EUR245m (US$336m) investment by car firms Zhejiang Youngman Lotus Automobile and Pangda.
A decision by China's NDRC could come as early as Friday, Reuters noted.
The paper also quoted Swedish Debt Office spokesman Daniel Barr rejecting media reports the government could pay off Saab's debt to the European Investment Bank and convert the security on the loan to shares in Saab.
"No, the Debt Office does not have any such mandate," he said.