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Swedish Automaker Saab Goes Bankrupt

John on December 19, 2011 at 10:20 am

This comes as a surprise to no one except perhaps the CEO:

On Monday, [CEO Victor] Muller finally threw in the towel after an exhaustive hunt for financing to keep the company going. In reality, Saab died last spring when the company stopped producing cars in Sweden and couldn’t meet its payroll. Sporadic cash infusions from the Swedish government and various Chinese investors had extended Saab’s life artificially, but now, finally, it will be liquidated.

Ironically, it was GM that finally forced Muller to end his resuscitation bid. The U.S. carmaker (which had been licensing technology to Saab) still owned preferred shares in Saab, thus giving it a say in any potential change of control. Muller had a last-ditch plan to sell Saab to a Chinese contract manufacturer, Youngman, for about $130 million. But GM, which is the leading manufacturer in China through its joint venture with China’s SAIC, objected, saying it couldn’t support a deal that would create a new competitor in China (especially one using GM’s intellectual property…

Saab employs over 3,300 people and this news is obviously very unwelcome to those who have been working sans pay in hopes the company would survive:

Saab employees, many of which still haven’t had their November pay, now don’t know what is in store for them in the near future.

“It’s so sad,” Ulf Drufva, who has worked at the Trollhättan plant for 39
years, told TT.

He added that GM’s blocking of the Chinese deal was “strange.”

“It’s as if GM sees Saab as a threat. And I can’t understand that, as small
as we are.”

Tough time of the year to be out of work.

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Category: Energy & Economy, Foreign Affairs |

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