GM confirms Saab sale

US automotive giant General Motors has confirmed that it has signed a stock purchase agreement with the Koenigsegg Group regarding the sale of Saab Automobile to the Swedish-led consortium.

• Koenigsegg buys Saab (17 Aug 09)
• Koenigsegg silent over ownership rumours (13 Aug 09)
• Saab sales in Sweden near rock bottom (3 Aug 09)

GM said it expected the deal to conclude in the next few months.

"The closure of the deal is contingent on the funding commitment from the European Investment Bank (EIB), guaranteed by the Swedish government,” said Carl-Peter Forster, president of GM Europe, in a statement.

As part of the proposed transaction, GM and Saab will continue to share technology and services during a defined time period. This will be managed through licenses and service agreements.

The deal was confirmed by the Koenigsegg Group who announced that they expected an agreement within the month.

"We have now concluded another important step in realizing the great potential of Saab," said Christian von Koenigsegg, CEO of Koenigsegg Group.

Saab Automobile welcomed the news in a press release on Tuesday morning.

"This is excellent news for everyone connected to Saab around the globe. This is an important step to secure jobs and our long-term future as a Swedish carmaker," said Jan Åke Jonsson, Managing Director of Saab.

Jonsson promised that the manufacture of the new Saab 9-3X would commence already in August.

"Our plan is to transform Saab into a stand-alone vibrant entrepreneurial company and make it 'sustainable' by making it profitable," Christian von Koenigsegg confirmed.

Jöran Hägglund, under-secretary of state at the ministry of enterprise, was satisfied that Saab's ownership issue had been cleared up.

"But there remains several steps before it is finalized. Koenigsegg Group has to come up with additional private capital, renegotiate loans with the European Investment Bank (EIB) and reach agreement with the National Debt Office over the conditions of any state guarantees. For all this the approval of the European Commission is also required."

Saab Automobile's reconstruction began in February when the firm's owners General Motors announced that it would cut off support to Saab by the end of the year.

According to a ruling in Vänersborg district court the process should be completed on Thursday.

If the deal between GM and the Koenigsegg Group were not to be completed by then the companies are entitled to apply for an extension.

The stock purchase agreement that has now been signed could mean that Saab Automobile can come out of reconstruction which has meant relief on 75 percent of its debt.

But much of the outstanding finance remains an issue to be solved. Saab's application for loans from the EIB require significant state loan guarantees and negotiations with the National Debt Office are on going. The government must give its blessing to the business plan.

The board of the EIB is scheduled to deal with Saab's application on September 22nd.