Patrick Rall's picture

Swedish debt authority prepares to seize Saab assets

The Swedish debt enforcement agency has notified banks holding assets that they may legally seize said assets in an effort to recover the large sum of money owe by the Swedish automaker to various supplies.
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Saab has avoided several bankruptcy claims in the past few months but none of those proceedings against the company have gotten this far, as the Swedish Enforcement Agency is now free to seize Saab’s assets, which includes any cash on hand in the bank. The current claim against Saab involves an unspecified number of supplies who are demanding the 4 million Swedish Krona owed as of Thursday ($625,000). For a multi-billion dollar company, $625k may not seem like a huge chunk of change but when you consider that this is only a small piece of what Saab owes its creditors and employees – things are certainly looking dark for Saab.

The current problem for Saab is that should they be able to come up with the $625,000 owed to the current group of unhappy suppliers, they have to then face payroll expenses less than two weeks away. Saab has already delayed payment in the past to both the blue collar and white collar salaried workers and considering that fact that Saab hasn’t built any new cars since April, you would think that employees are more than a little concerned about getting paid this month. Saab has managed to pay their employees along with a group of suppliers and creditors in the past few months by selling their Trollhattan production facility and large chunks of the company but should the Swedish Enforcement Agency begin seizing and selling off Saab’s assets to create cash to pay creditors, it could bring about a swift and painful end to the automaker.

Saab continues to look for investors to help them get their heads above water but with so much of the company already sold off and the downward spiral of the company, we can expect that it is going to get harder and harder for Saab to find investors willing to sink money into the fading automaker. In short, this latest piece of news could be just enough to scare off any remaining investors – officially opening the coffin for Saab and parent company Swedish Automobile.

Saab recently announced that they would not be displaying at the 2011 Frankfurt Motor Show next month...at this point, we have to wonder if they will survive to display again.

Other Saab News:
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
Saab cannot pay salaried workers this month
Saab secures another $35 million loan, production could begin soon
Breaking: Saab sells plant to investment group

Source: Reuters


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Comments

My grandfather said the American Auto Industry died when Packard closed in 1958. I went to the Cadillac / SAAB dealer last Sunday, there were two SAAB 9-5 sedans from 2010 on the showroom unsold. Nice car but at $54000 way too expensive.