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SWEDEN: New NEVS reorganisation approved to "get things in order"

By Simon Warburton | 11 December 2014

NEVS given another chance to sort ownership

NEVS given another chance to sort ownership

National Electric Vehicle Sweden (NEVS) says it has until 2 March to "get things in order" as it secures a latest approval to extend reorganisation.

The District Court of Vanersborg ruled in favour of a three-month extension to NEVS' reorganisation, as speculation increasingly centres on Mahindra & Mahindra emerging as the front runner to take over the troubled Swedish automaker.

"The timeframe the prolongation states is until 2 March - we have to get things in order as state [d] before," a NEVS spokesman in Trollhattan told just-auto. "We have to get solutions on short term financing and long-term reorganisation financing."

NEVS is currently burning through SEK35m (US$4.7m) a month to keep its factory running in Western Sweden, after laying off 155 people in October in a bid to slash monthly costs from SEK200m.

It has also stopped contracts with more than 100 engineering consultants as it looks to battle SEK600m of debts to 600 creditors.

"I am glad the District Court has decided to prolong the reorganisation," said NEVS president, Mattias Bergman.

"We need the time the prolongation allows to concretise and finalise the ongoing negotiations."

NEVS still employs around 380 people at the Trollhattan factory, some 180 of whom work on producing body work to Orio, formerly Saab Automobile Parts.

The automaker says it in contact with the local Council as well as the IF Metall and Unionen labour bodies, who are also on the creditors committee.