Bankrupt General Motors Corp. has found a buyer for Saab, unloading the last major piece of the shrinking automaker’s empire that had been on the block.
The brand will be bought by Swedish carmaker Koenigsegg Group, known for making $1.2-million super-cars that can top 240 mph.
A price was not disclosed, although GM said the acquisition would be bolstered by $600 million in financing from the European Investment Bank, backed by the government of Sweden. GM said it would provide additional support to help Koenigsegg take over Saab and complete work on vehicles in development. Los Angeles Times
Saab sold 93,000 cars last year, and it has not turned a profit in years. With a narrow, though loyal, customer base focused on Sweden, Britain and the American Northeast, it proved too small to lure the world’s big automakers, many of which are seeking tie-ups to increase economies of scale.
“I’m struggling to see the point of this deal,” said Philippe Houchois, head of European auto industry research at UBS in London. “Is it to ensure the survival of Saab, to save jobs? It looks like a short-term solution that doesn’t resolve the core issues.”
Saab, he added, is too small to make money in the long term.
With its American parent in restructuring and the Swedish government taking a hard line, Saab filed for reorganization on Feb. 20. General Motors itself sought protection from creditors on June 1. New York Times
“This is yet another significant step in the reinvention of GM and its European operations,” GM Europe President, Carl-Peter Forster, said in a statement.
A person briefed on the deal said GM will get nothing initially for Saab, but would be paid $150 million — capital Saab had left over from GM’s ownership — on top of the value of Saab’s assets if the new company turns a profit. The person, who did not want to be identified because the deal has not been closed, could not estimate the value of those assets.
Saab Chief Executive Jan Ake Jonsson called the deal “great news” and said it would help the brand to maximize it’s potential “through an exciting new product lineup with a distinctly Swedish character.”
The sale is expected to be completed by the end of the third quarter and is subject to regulatory approvals.
Nelson Silveira, a GM spokesman in Zurich, declined to give any financial details and would not disclose information about the investors. The Associated Press
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