Connect with us

Hi, what are you looking for?

General Motors


GM’s cloud over Chinese Saab rescue ‘regrettable’: Sweden

General Motors

STOCKHOLM, Nov 8 – A statement by General Motors this week threatening to block technology licences if two Chinese companies buy Saab, clouding a rescue, was unfortunate the Swedish government said on Tuesday.

“That was a regrettable announcement,” Swedish Enterprise Minister Annie Loeoef told reporters in Stockholm.

Her comment came a day after GM said it would end technology-sharing licences to Saab and stop supplying the 9-4X SUV model to its insolvent former subsidiary if it were acquired by Chinese companies Pang Da and Youngman.

But GM said it would still supply some components.

That announcement jeopardises a last-ditch deal reached by the two firms last week with Saab’s current Dutch owner, Swedish Automobile, or Swan to buy the beleagured carmaker for 100 million euros ($134 million) and supply 610 million euros in long term funding.

Saab, which halted production six months ago as suppliers stopped deliveries owing to mountains of unpaid bills, would also receive 50 million euros in immediate bridge-financing to keep it afloat during its ongoing restructuring under bankruptcy protection.

The deal, the last in a long line of schemes presented by Swan’s charismatic chief executive Victor Muller in recent months to rescue Saab, was hailed in Sweden as a real chance at salvation for the carmaker but still requires a green light from a number of interested parties, including GM.

“When we last week saw the possible Chinese solution it was truly a joyous occasion. But with GM’s announcement yesterday (Monday) that they are saying no to this solution we now have a fly in the ointment. They have to start all over again,” Loeoef said.

GM sold an already bankruptcy-prone Saab in early 2010 to Swan — at the time called Spyker — for $400 million, had already announced at the weekend it was considering blocking the deal, which it said “could negatively impact GM’s existing relationships in China or otherwise adversely affect GM’s interests worldwide.”

A spokeswoman for Pang Da told Swedish news agency TT the two Chinese companies were working hard to resolve the GM stumbling block, and Loeoefsaid the Swedish government was “acting as a door-opener in the contacts between Chinese authorities and GM.”

Advertisement. Scroll to continue reading.

However, she stressed, “at the end of the day, it is the parties, Saab and the Chinese (firms), who need to reach a deal… Now (Saab’s court-appointed) administrator and the private parties need to sit down at the negotiation table and find a long-term solution for Saab and its employees.”

Saab currently employs some 3,700 people, but has said it is planning around 500 lay-offs as part of the pending Chinese deal.

Click to comment

More on Capital Business

Executive Lifestyle

NAIROBI, Kenya, Mar 12 – The country’s super wealthy individuals are increasing their holding of bonds, gold and cash, a new report by Knight...

Ask Kirubi

NAIROBI, Kenya, Mar 9 – Businessman and industrialist Dr. Chris Kirubi has urged members of the public to exercise extreme caution when making any...

Ask Kirubi

NAIROBI, Kenya, Mar 24 – Businessman and industrialist Dr. Chris Kirubi is set to own half of Centum Investment Company PLC, following a go-ahead...

Ask Kirubi

It is without a doubt that the COVID-19 pandemic has caught the whole world by surprise. Although its full impact is yet to be...


NAIROBI, Kenya, Jun17 – Kenya’s tea leaves manufacturer Kericho Gold, has been awarded the Superbrands Seal by Superbrands East Africa for their quality variety...


NAIROBI, Kenya, Mar 18 – Commercial Banks have been ordered to provide relief to borrowers on their personal loans, with loans eligible from March...


NAIROBI, Kenya, Apr 13 – As the local telecommunications industry gears up to roll out 5G networks in the country, the Communications Authority of...


NAIROBI, Kenya, Mar 22 – Airtel Kenya is offering free internet access for students in order to enable continued learning at home in the...