Saab to face first bankruptcy hearing on September 26th
Saab has made strategic moves over the past few months to acquire chunks of cash to pay angry creditors and suppliers but with the Swedish automaker being late to pay their union workers in June and July – with no payment made for the month of August – the unions representing these workers have served bankruptcy applications. Should Saab not be able to come up with the money to pay the wages of their workers, the company could very well be forced into bankruptcy by the Swedish court system in an effort to recover the money owed to the workers and other creditors around the world.
Earlier this week, Saab reportedly obtained 70 million Euros through a bridge loan guaranteed by one of their Chinese investors. While this isn’t enough money to come anywhere close to paying off all of their debts, Saab hopes that this new chunk of change will help sway the Swedish government’s decision not to protect the automaker from bankruptcy claims. However, the company hasn’t built a car at their Trollhattan plant since April and nearly all of the money brought in over the past 5 months was from outside investors. Saab has basically stayed alive this long by selling off chunks of the company, including the Trollhattan plant, so it may be hard for Saab and Swedish Automobile to convince the government that they are capable of recovering from this cash crunch. Their first request for protection was declined because the government didn’t believe that re-organization would make any difference and with their labor union filing to force Saab into bankruptcy, even with 70 million Euros in their pocket it is hard to foresee Saab pulling out of this downward spiral.
If forced into bankruptcy, the Saab brand could be facing its demise unless someone who can afford to pay all of their debts steps in to help. The only person who can seemingly do this is Russian investor Vladimir Antonov but with Saab owning money to the European Investment Bank and the EIB refusing to let Antonov be involved with the Swedish automaker, Saab will have to rely on the approval by the Chinese government to get back on their feet.
TorqueNews will continue covering this, bringing you any news as it becomes available.
Other Saab News:
Saab’s request for government protection denied – bankruptcy appears imminent
Saab files for government protection, plans reorganization
Swedish debt authority prepares to seize Saab assets
Saab will not display at the 2011 Frankfurt Motor Show
Saab pays the workers, avoids bankruptcy for now
European Investment Bank refuses access of Saab to Russian Antonov
Source: Automotive News