2oceans Vibe

Saab Automobile has spent the last two years fighting to salvage the iconic brand that manufactured cars for six decades, but today announced that it had filed for bankruptcy in a Swedish district court. General Motors, who still had control over technology licenses, had disapproved of negotiations with two Chinese firms that sought to save Saab.

Swedish Automobile, Saab’s owner, said in a statement:

The company without further funding will be insolvent and that filing bankruptcy is in the best interests of its creditors.

It is expected that the court will approve of the filing and appoint receivers for Saab Automobile very shortly.

A clerk at the Vaenersborg district court reiterated:

They were here this morning and submitted the documents requesting bankruptcy.

Saab started out as an aircraft manufacturer in 1937, built its first prototype cars in 1947, and rolled out its first production vehicles in 1949.

The slick, aerodynamic shape of its first concept designs was something the brand became famous for, and the designs continued to emulate this feel right up until it was forced to halt production in April this year when suppliers stopped deliveries because of unpaid debts.

Even though General Motors sold Saab to Swedish Automobile in early 2010, GM had been opposed to agreeing to transfer the necessary technology licenses to the Chinese firms, car maker Youngman and car distribution company Pang Da, that had been negotiating to save the Swedish car maker.

This was because the proposed deal wasn’t, “meaningfully different from what was originally proposed to General Motors and rejected,” and that, “Each proposal results either directly or indirectly in the transfer of control and/or ownership of the company in a manner that would be detrimental to GM and its shareholders.”

It has since emerged that Pang Da pulled out of the negotiations a few weeks ago.

Saab had also delayed its 3 700 employees’ salaries for five months running, but once the bankruptcy filing is approved, they will be paid through a state wage guarantee.

The decision comes as Swedish Automobile’s magnetic chief executive, Victor Muller, was to appear before the court on Monday in a bid to see if judges would lift or prolong a three-month bankruptcy protection order Saab had been placed under while it was trying to negotiate a deal to rescue the company.

[Source: BusinessDay]