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General Motors to sell Saab unit to Koenigsegg Group

“Closing this deal represents the best chance for Saab to emerge a stronger company.” — Carl-Peter Forster, General Motors Europe president

US automaker General Motors (GM) has signed a tentative agreement to sell its beleaguered unit, Saab Automobile, to Swedish luxury sports car maker Koenigsegg, GM said in a statement yesterday.

“General Motors Corp and Koenigsegg Group AB, a consortium led by Koenigsegg Automotive AB, today confirmed the details of a memorandum of understanding for the purchase of Saab Automobile AB that secures Saab’s future,” the US automaker said.

GM, now in bankruptcy protection in the US, put Saab up for sale in February as part of its plan to trim its range of brands and become profitable again.

The Swedish company has been undergoing a legal reorganization process since Feb. 20.

Koenigsegg, founded in 1994 by Swedish businessman Christian von Koenigsegg, has just 45 employees and produces 18 high-end sports cars a year for more than a million euros (US$1.4 million) each.

“Koenigseggs Group’s unique combination of innovation, entrepreneurial spirit and financial strength, combined with Koenigsegg’s proven ability to create world-class Swedish performance cars in a highly efficient manner, made it the right choice for Saab as well as General Motors,” GM Europe president Carl-Peter Forster said in a statement.

“Closing this deal represents the best chance for Saab to emerge a stronger company,” he said.

The sale, which is expected to close by the end of the third quarter, includes an expected US$600 million funding commitment from the European Investment Bank, guaranteed by the Swedish government.

“Additional support is to be provided by GM and Koenigsegg Group to fund Saab’s operations and product programme investments,” GM said.

Saab sold 93,000 cars worldwide last year, its Web site said.

It owes 9.7 billion kronor (US$1.3 billion) to GM — its largest individual creditor — as well as 347 million kronor to the Swedish government. Other creditors are owed 647 million kronor.

Saab Automobile employs about 3,400 people in Sweden, and some 12,000 other jobs in the country are dependent on Saab through suppliers.
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