GM’s Swedish brand Saab announced that it has filed for bankruptcy protection today. The brand is hoping to be spun off or sold by its struggling General Motors owner. The move comes after the Swedish government turned down GM’s request for loans to help Saab.
Saab submitted an application to reorganize the brand in which it will seek funding to become “a new independent Saab.” Saab will work with an independent administrator appointed by the Swedish court who will work with the Saab executives. Saab will have to submit a “proposal of reorganization”
After being approved, the government will help Saab reorganize over a 3-month period where it will get independent funding.
Follow the jump for the press release.
SAAB ON THE ROAD TO INDEPENDENCE
– Swedish court process to reorganise Saab into a fully independent business
– Three new models ready to be launched over the next year and a half
– Saab aims to bring resources back to Sweden
– Funding sought for ‘new independent Saab’
TrollhÃ¤ttan. As a result of GM’s strategic review of the global Saab business the Saab Board announced today that it will file for reorganisation under a self-managed Swedish court process to create a fully independent business entity that would be sustainable and suitable for investment.
The reorganisation is a self-managed, Swedish legal process headed by an independent administrator appointed by the court who will work closely with the Saab management team. As part of the process, Saab will formulate its proposal for reorganisation, which will include the concentration of design, engineering and manufacturing in Sweden. This proposal will be presented to creditors within three weeks of the filing. Pending court approval, the reorganisation will be executed over a three-month period and will require independent funding to succeed.
“We explored and will continue to explore all available options for funding and/or selling Saab and it was determined a formal reorganisation would be the best way to create a truly independent entity that is ready for investment,” said Jan Ake Jonsson, Managing Director for Saab Automobile. “With an all new 9-5, 9-3X and 9-4X all ready for launch over the next year and a half, Saab has an excellent foundation for strong growth, assuming we can get the funding to complete engineering, tooling and manage launch costs. Reorganisation will give us the time and means that help get these products to market while minimising the liquidity impact of Saab on GM.”
Funding for the restructured company will need to be secured during the reorganisation process and will be sought from both public and private sources.
Saab will continue to operate as usual and in accordance with the formal reorganisation process, with the Government providing some support during this period. The reorganisation should have no impact on other GM operations. Details of the progress will be provided as milestones are achieved.