GM says reaches deal to sell Saab to Koenigsegg

By Veronica Ek and Sven Nordenstam
STOCKHOLM (Reuters) - Sweden's Koenigsegg, a niche manufacturer of some of the world's fastest and most expensive sports cars, has struck a deal to buy loss-making Saab Automobile from General Motors, the companies said on Tuesday.
In one of the most unlikely pairings in automotive history, the tiny sports car firm of 45 staff is expected to take over a company that employs around 3,400, a cherished Swedish brand that became a national icon for stability and reliability.
GM Europe said on its website the deal, set to close by the end of the third quarter, includes an expected $600 million of financing from the European Investment Bank, guaranteed by the Swedish government. Other terms were not disclosed.
"Additional support is to be provided by GM and Koenigsegg Group AB to fund Saab's operations and product program investments. This includes plans to launch several new products that are in the final stages of development," GM Europe said.
Like its U.S. parent, Saab has been in bankruptcy protection. It has said it needs $1 billion to see it through the crisis and has asked creditors to write off 75 percent of its 10.6 billion crown ($1.4 billion) debt, most of which is owed to GM.
Koenigsegg, which produces powerful roadcars that cost around $1 million, came out of nowhere to emerge as a front-runner to buy Saab.
But analysts are skeptical a tie-up makes sense, noting that Christian von Koenigsegg, founder of the firm bearing his name, has no evident experience owning or running a firm so large.
Last year Koenigsegg made 18 cars, Saab more than 93,000.
"There are no economies of scale between Saab and Koenigsegg. This is a constellation of buyers that probably have different interests than GM, which was driven by volume," said Mikael Wickelgren, an automotive expert at Skovde University, in southwestern Sweden not far from Saab's headquarters.
"This will be a business where one would assume that the owners want to chisel out a personality for Saab. The logic would be in the special and unique. Otherwise I cannot understand this deal."
Koenigsegg has backing from Norwegian entrepreneur Bard Eker, whose holding company owns 49 percent of the car maker.
Halldora von Koenigsegg, spokeswoman for the company and wife of its founder, said a memorandum of understanding had been signed but declined to comment further.
TWO DECADES UNDER GM
The deal would see Saab, which was put up for sale earlier this year, emerge from two decades under its U.S. parent. GM is already in the middle of offloading two other brands -- Saturn and its Hummer SUV line -- as it works to restructure its operations in bankruptcy.
Saab's roughly 220 U.S. dealerships have until Friday to sign an agreement which allow their franchises to be transferred to a new owner, a person familiar with the matter said. Dealers have been asked to prepare for an orderly wind-down should the automaker be unable to close a deal to sell the brand. Continued...
Source: Reuters