With Saab stumbling closer and closer to bankruptcy, its potential Chinese lifelines – distributor Pang Da and automaker Youngman Lotus – offered to take over the company. Saab said no.
This summer, Saab struck a $336 million deal with Pang Da and Youngman that would give the ailing Swedish automaker cash to survive through the near future, but the deal never made it far, as all parties continue to wait on approval from the Chinese government. This week, Pang Da and Youngman made a new offer to Saab: a takeover in the form of a cash purchase of 53.9 percent of the company. Saab CEO Victor Muller declined the offer. The original agreement from July is still on the table, though.
While speaking to Reuters, Muller said that “the token offer was unacceptable because it would trigger every conceivable change of control clause and that would possibly mean the end of Saab.”
Declining the takeover offer was a brash move given Saab’s current financial state. The company has not produced a vehicle in month – save for the 9-4x crossover that General Motors continues to build in Mexico, alongside the Cadillac SRX. Saab had been granted bankruptcy protection in recent months, but according to Automotive News Guy Lofalk, the administrator charged with Saab’s restructuring, has asked the Swedish courts to end the protection. Reportedly, the company doesn’t have enough liqudity to complete a restructuring.
It was thought that Saab might have one final hope in the form of $70 million promised by Greenwich, Connecticut-based North Street Capital. North Street, which recently scored a controlling interest in Spyker from Saab’s parent company, announced it would take a stake in Saab and simultaneously grant the automaker a loan. That said, Lofalk says that the newfound $70 million wouldn’t nearly be enough to keep the car company going.
Saab will continue to seek out partners and financing and will continue to wait for the final approval from the Chinese government on the Pang Da/Youngman deal, but this could very well be the end of the line.