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GM to fill Saab funding hole: report

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GM to fill Saab funding hole: report
10:37 CEST+02:00
The prospective purchaser of the ailing Saab Automobile company – the Koenigsegg Group – has found new investors to enable it to complete the deal, according to reports in the Dagens Industri business daily.

Saab's current owner, General Motors, will also stump up three billion kronor ($412 million) to fill the funding hole.

The paper's information reportedly came from a source close to the deal. Koenigsegg Group, which has been pressing the Swedish Government over the last two weeks for top-up funding in order to save the company, has stated that it can now complete the deal without government assistance.

"Koenigsegg Group no longer needs additional financing from the Swedish state due to securing financing with the help of GM and new investors,” said the source.

The new settlement may be presented as soon as next week. Saab requires approximately 11 billion kronor ($1.5 billion) before the company can begin to operate profitably, according to the Koenigsegg Group. Current owner GM has already contributed 2.8 billion kronor ($385 million) in the form of a loan and through paying for production equipment for the new Saab 9-5. The Koenigsegg Group has contributed 720 million kronor.

The company also hopes to secure a loan from the European Investment Bank of around 5 billion kronor. In order to secure that loan the company will require a guarantee from the Swedish Government.

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