- Saab told Inside Line that vehicle production may restart in eight weeks after two Chinese firms agreed to buy the automaker for $142 million.
- Today's announcement "helps to secure the future for Saab," the automaker said.
- The unveiling of the new Saab 9-5 SportCombi may still be on tap for the 2012 New York Auto Show, depending on how fast the automaker wins regulatory approval of the deal and the cash begins to flow again.
ROYAL OAK, Michigan — Saab told Inside Line that vehicle production may restart in eight weeks after two Chinese firms agreed to buy the automaker for $142 million — a massive discount from their initial purchase offer four months earlier.
Parent Swedish Automobile (Swan) on Friday said it has entered into a memorandum of understanding with Pang Da Automobile Trade Co. and Zhejiang Youngman Lotus Automobile Co. to sell 100 percent of the shares of Saab to the Chinese companies.
The deal is historic because both of Sweden's car brands — Volvo and Saab — are now in the hands of the Chinese.
The latest offer to purchase all the shares of Saab represents a discount of nearly 80 percent from the original agreement by Pang Da and Youngman in June to acquire a 53-percent stake for $350 million — an offer that valued Saab at around $660 million.
"We are very pleased with today's announcement," said Michele Tinson, director of communication at Saab Cars North America, in a phone conversation with Inside Line. "It helps to secure the future for Saab."
Tinson said Saab's Trollhattan, Sweden factory, which has been idled since late March, may be running in eight weeks in "the best-case scenario." The factory builds the Saab 9-5 and 9-3. Production of the Saab 9-4X crossover at General Motors' Ramos Arizpe, Mexico plant will "get back up and running more quickly than Sweden," she said.
The introduction of the Saab 9-5 SportCombi, originally slated for the 2012 New York Auto Show, "may still be the case," Tinson said. "But there are a lot of other dominos that need to be in place" for that introduction to happen, she added.
Tinson praised Saab loyalists for "sticking by us in this time of uncertainty." She also noted that Saab's North American dealers "really stuck by us." She said that Saab originally had 210 dealers in North America and is down to approximately 187 at this point.
"It's important to recognize them and that they have faith in the product," Tinson said. "Financing was a concern to those who left."
Saab had about 11,000 orders for cars worldwide as of May.
The memorandum of understanding is valid until November 15, said Saab in a statement on its corporate Web site. It noted that Guy Lofalk, the administrator of Saab's reorganization, has withdrawn his application to pull the plug on the reorganization process. Final agreement of the deal is subject to regulatory approval in China and approval by Swan shareholders and "other parties."
The $142-million purchase offer for all the shares will be paid in installments.
The latest development comes after Saab just days ago rejected an offer from the Chinese companies for an outright buyout.
Inside Line says: Saab lives!
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menacingllama says:
06:40 AM, 10/31/2011
Wow, good job, Sweden -- way to let your only automakers (with some good history behind them, no less) be controlled by a foreign asset.
lolxd says:
08:12 AM, 10/29/2011
I hope the new owner will NOT do anything to Saab other than financing them and helping with Marketing.
I sure love those Chinese car ads in which cars that are not so special are treated as if being driven by royalty
Don't know what I mean? see those MG/Rowei ads on Youtube :D
pommah says:
06:50 AM, 10/29/2011
Maybe the new owners will have enough money to spend on advertising, so that all the car rags will finally admit they are good cars.
And hopefully the new owners won't force Saab to put not-ready-for-prime-time technology into the cars to serve as rolling test beds with attendant reliability issues, like GM did.
qdp says:
03:50 PM, 10/28/2011
Compared to Lincohn, Murcury,and Buick, both Volvo and Saab are much more distinct and unique brands. Always think that Ford should have kept Volvo and droped both Murcury and Lincohn.
It is very obvious that Volvo's new s60 and particular the diesel-hybrid technology which is the first of its kind in auto industry, had been being developed way before Chinese takeove. Regretedly, currently Ford doesn't possess that kind of revolutionary technology and still have to get its hybrid license from toyota which is why Ford's new hybrid cars are always a year or so behind Toyota's.
Good luck for Saab
tbone85 says:
02:54 PM, 10/28/2011
Having swum with the sharks in suits a couple of times, very few good things happen down the road for employees or customers when you're dealing with people who treat you the way the acquiring companies treated Saab. I found Saab products interesting, but their new owners seem to have a bit of a deficit in the integrity department.
broq3_5 says:
12:39 PM, 10/28/2011
@Lookatmyshoes-
The S60 was completely done prior to the sale of Volvo. It was even shown at several car shows.
angry_mushroom says:
10:22 AM, 10/28/2011
Hate to say it, but I doubt a Chinese owner will be any worse than GM for Saab.
urbansophistic says:
10:17 AM, 10/28/2011
Glad Saab is still here as a Swedish automaker loyalist, BUT terribly uncertain about the future. The deal inked way undervalued Saab's worth, or at least their debts!
The new S60 was in the works way before Volvo was sold off to Geely, so we have yet to see the fruits -- or spoils -- of that union.
All in all, I'd love to both brands prevail and return to prominence across the globe , and especially here in the US.
Signed a Volvo baby.
whutaka1 says:
09:13 AM, 10/28/2011
I'm thrilled SAAB has the Chinese financial investment to continue manufacturing a fine engineered automobile. I anxiously await SAAB's competitive's edge to emerge from behind the stormy dark clouds with a clap of thunder or the sonic boom of a jet delivering a beautiful rose to the gorgeous lovely lady behind the wheel of a SAAB! How dare they ...........
zelee_deville says:
09:08 AM, 10/28/2011
I like Saabs resilience..