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Sweden approves new Saab financing plans

TT/The Local/dl · 15 Apr 2011, 17:45

Published: 15 Apr 2011 17:45 GMT+02:00

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"The government has given Saab the green light to borrow money for its daily operations," Olofsson told reporters.

Sweden has a final say in Saab's business because it last year guaranteed a €400 million ($580 million) European Investment Bank (EIB) loan for the company through its National Debt Office (NDO).

The NDO sent Saab's refinancing proposal to the government late Thursday with a recommendation that it be approved.

The solution means that Saab has permission to sell its real estate to Russian financier Vladimir Antonov. In exchange, Saab will be able to use the entire loan from the EIB.

"In practice, this means a reduction in tax payers' exposure because the amount of the loan will be reduced," Olofsson said.

Under the agreement, the NDO released its security covering Saab's property holdings, meaning Spyker can now use these assets to raise fresh cash.

She explained that the debt office is in the middle of carrying out an investigation of the new owner and that Friday's decision doesn't mean it has completed its assessment.

The probe is being conducted at the request of Saab, but is not yet finished.

The Debt Office must first eliminate a number of questions surrounding the new owner, said Olofsson.

But the government has placed three tough conditions in order for the deal to be approved.

The agreement must be signed between Saab and the buyer of its associated property company, Saab Automobile Properties AB, guaranteeing Saab a reasonable payment for company.

Saab must also retain access to the facilities to carry out its production. Finally, payment for the real estate must be carried out through a bank that isn't controlled by the buyer.

Olofsson explained that the condition that the transaction be carried out through a European bank was meant to ensure the government that the deal involved a "serious buyer".

She added that the requirement would also minimize the risk of money laundering.

Story continues below…

Spyker rescued iconic Swedish brand Saab at the last minute in January 2010 by buying it from US auto giant General Motors.

But it did not meet its sale objectives for the year and last month Saab started halting production amid conflicts with suppliers over unpaid bills.

Saab said last week production was stopped "until further notice".


TT/The Local/dl (news@thelocal.se)

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Your comments about this article

22:21 April 15, 2011 by jack sprat
By hook or by crook it's only a matter of time before the company, or whats left of it, ends up in the hands of the Ruskies.

Spyker has never ever been a feasible option,but simply the means to an end.
00:37 April 16, 2011 by BillyB
what a waste of money
11:57 April 16, 2011 by ooh456
Saab hasn't made money for years and anyone who buys one now is crazy. Why on Earth would anyone invest in a business that is destined to fail?
12:01 April 16, 2011 by Jasper2
With Swedish Enterprise and Energy Sinister Maud Awfulsson on the case, what me worry?
12:31 April 16, 2011 by RobinHood
A neat and predictable way of transferring Saab's best assets into Antanov's control at fire sale prices. Nicely out of the reach of the creditors when Saab becomes insolvent

Everyone involved, including the press and Maud, know this. Everyone is so scared of taking the blame for tipping Saab over the edge, Antanov is running away with the company while they stand mute. There's the scandal.
02:28 April 17, 2011 by repat_xpat
As a GM employee, I am thrilled that the Swedish government relieved GM of its liability to the SAAB employee/pensions. Thank you Sweden!
14:05 April 18, 2011 by TheOriginalBlackMan
Tax payers money spent as if it's made out of air.
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