Prior to Wednesday’s meeting, most indications were that the EIB board, which includes representatives from all 27 European Union members states, would approve Saab’s request.
The EIB leadership group had recommended to the board that the bank agree to lend the Swedish car company up to €400 million, or roughly 4.1 billion kronor ($590 million), having concluded that Saab’s application was sufficiently strong.
The loan is a critical lifeline for Saab, and was a key element for the planned takeover of the company by the Koenigsegg Group.
“It wasn’t totally unexpected. It was an incredibly important step for Saab’s future. Without the loan, it would have been a nonstarter,” Jöran Hägglund, a state secretary with Sweden’s industry ministry, told the TT news agency.
The money, mainly targeted at cleaner and more fuel-efficient production, marks a huge step towards the purchase of Saab from its US parent company General Motors by Swedish sports car maker Koenigsegg and Beijing Automotive Industry Holding Co Ltd (BAIC).
“The loan will be used for research and development activities for the improvement of fuel efficiency and safety including new tooling for the production of cleaner and safer cars, subject to the European Commission’s approval of the Swedish state guarantee,” said a statement by the EIB.
Stockholm has repeatedly refused to take a stake in Saab, but Koenigsegg had asked the Swedish government — unconvinced about its business plan — to act as a guarantor.
Koenigsegg had been short 3 billion kronor to complete the acquisition of Saab first announced in June, though the total purchase price has never been disclosed.
Saab employs 3,400 people in Sweden alone and sold just over 93,000 cars worldwide in 2008.
Koenigsegg Group, founded in 1994, has just 45 employees and produces 18 high-end sports cars a year at more than a million euros ($1.4 million) each.
Under GM’s stewardship, Saab rarely posted a profit and last year lost 3 billion kronor.