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Sweden refuses to fill capital hole in Saab deal

Peter Vinthagen Simpson · 19 Aug 2009, 10:07

Published: 19 Aug 2009 10:07 GMT+02:00

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"We have received a request, but it is not our current position. The financial instruments that we have available are the loan guarantees. We have been clear with Koenigsegg that this is the case," Jöran Hägglund, under-secretary of state at the ministry of enterprise, said in a press conference on Tuesday.

Christian von Koenigsegg meanwhile argued on Wednesday that the Swedish state is a core part of the deal.

"We see this as a deal between three parties; General Motors, Koenigsegg Group and the Swedish state," he said to the Svenska Dagbladet (SvD) newspaper.

He confirmed that the company was experiencing problems securing finance to complete the deal and argued that the government is in a position to assist.

"We have tried to find financing for around 30 percent of the total capital requirement, which equates to around 3 billion kronor. But as the banking system is not currently functioning normally it is reasonable to expect to be able to secure a bridging loan until we can secure the capital," he told SvD.

But Hägglund pointed out that the government has consistently opposed such a move.

"We have made it clear that the Swedish tax payer will not go in and finance a whole deal between Koenigsegg and GM with regard to Saab. Had that been the case we would have bought the company in the first place."

"We have also been clear about how substantial the loan guarantees can be. This is dependent in part on how large the loans EIB (the European Investment Bank) decide that they can provide and naturally that there is security in place that covers such a loan," he added.

Hägglund was clear that the Swedish National Debt Office (Riksgälden) was ready to act on the loan guarantees as soon as the EIB had approved the loans - a decision that will be taken on September 22nd.

Story continues below…

"When the board of the EIB can take a decision over the loans, then the other required decisions - the Swedish government's blessing, the loan guarantees and the EU Commission's examination of the deal - should be ready as soon as possible so that the delay between a decision and payment is short," he said.

Hägglund underlined that the government welcomed the announcement on Tuesday that a stock purchase agreement had been signed between the Koenigsegg Group and GM.

"It is of course important as a first step to establish an independent Saab Automobile, but most of the work to achieve this goal remains."

Peter Vinthagen Simpson (news@thelocal.se)

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Your comments about this article

11:28 August 19, 2009 by titousmum
and who couldn't see this coming like a bad train wreck? another kink in saving how many jobs? i thought that the gov't had made themselves very clear some months ago.
14:40 August 19, 2009 by usgepo
Way to go Mr, Hägglund, think twice before giving away tax payer moeny, things are not aas they seem, it is a pump and dump venture, they are allready showing signs and dumping shares.

Full transparency or no deal! No one minds if they get rich, but do it with your own money, not the tax payers.
23:13 August 19, 2009 by Jan M
I agree. Not worth risking taxpayers money. The 'Phoenix Four' bought Rover in the UK from BMW for a nominal sum (£1 I think) and presided over four years of falling sales whilst their salaries and pension pots rose. The company folded but they didn't do too badly. My only question about the Koenigsegg-Saab deal is how Koenigsegg became the preferred bidder in the first place. Normally if due diligence is followed a preferred bidder has to make a set of legally binding financial guarantees to gain 'preferred' status. There should somewhere be signed documents from von Koenigsegg specifying the general financing for the deal. Where are they? For the sake of transparency and to squash this ridiculous extortion attempt they should be released to the public, particularly since he's clearly broken confidentiality agreements by talking to the media.
13:55 August 20, 2009 by usgepo
Very good points you bring up Jan!
10:31 August 21, 2009 by skane refugee
Great points Jan M ...

Suspect the simple reason for Koenigsegg gaining preferred bidder status was and is that they are the only interested 'buyers' ...

but of course 'buyers' is a misnomer ... because SAAB auto as a whole probably has negative value ... GM and/or the Swedish taxpayers were always going to have to pay someone to take it on ... (whatever number the PR boys came up with for the 'sale price')

the loan guarantees already pledged are an eye watering cost per job 'saved' ... the additional 3 billion requested is surely untenable

SAAB cars may well be about to go to the wall
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