GM Sells Saab to Spyker, Sources Report

By Brendan Moore

01.25.2010

Saab emblem blue background

UPDATE – 12:30 PM ET, Jan 25: GM Chairman and CEO Ed Whitacre stated during a press conference a short time ago that, “GM does not have a deal” and “has not changed direction” on shutting down its Swedish unit”.  He said the GM is still moving forward with the orderly shutdown of Saab.

Sources in Sweden are still reporting that a deal is imminent.

Original post follows:

Several sources are now reporting that a deal to sell Saab to the Dutch supercar maker Spyker Cars NV has been reached, and will be announced later today.

United Press International, Reuters, Sweden’s Dagens Industri and the Financial Times are all reporting that Spyker will hold a press conference today to make public the agreement, which take effect as soon as possible in order to minimize any business disruptions. It is expected that GM will either participate in the same press conference, or, issue their own public statement.

Bloomberg News is reporting that Spyker has offered GM approximately $500 million USD for Saab. The $500 million breaks out as follows: $325 million in preferred shares in the next corporate iteration of Saab, $75 million in cash and $100 million of Saab’s existing liquid assets.

The deal marks the end of a long, forced march for Spyker, who has now been trying to meet GM’s conditions for a bid for sometime now, and has been rebuffed over and over. It also puts them squarely on the map as “somebody” in the world of mainstream automotive manufacturing.

The sale agreement comes at the expense of rival bidder, Genii Capital, who had recently stepped up their efforts to win Saab, but it appears that Spyker’s head start in the bidding was the determining factor. If Spyker falters in the execution of the deal, a la the previous would-be owner of Saab, Koenigsegg, it is expected that Genii will step into the breach. The Luxemburg-based Genii was getting help from Bernie Ecclestone, head of Formula One, in their efforts to buy Saab.

It seems the breakthrough that paved the way for the sale of Saab was achieved over the weekend in lengthy sessions Spyker had with both GM and the Swedish government. The Swedish government agreeed to guarantee a financing loan from the European Investment Bank for the Swedish car maker, said people close to the deal. The same sources said that, for their part, GM accepted the basic terms of Spyker’s offer, but wanted Russian businessman Vladimir Antonov, the chairman and biggest investor in Spyker, to leave the company.

In a related note, Spyker Cars stock shares spiked 30 percent in morning trading in Amsterdam on news of the deal.

We will bring you more details as we know more.

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Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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6 Comments

  1. It appears this is true now, although apparently not going to be announced today. I am so happy for Saab.

    I don’t know things will turn out with Spyker, but the only other alternative was death, so this is a huge step in the right direction.

  2. About time. I guess we’ll see soon if GM really was to blame for Saab’s decline, since they now have new owners.

  3. GM says no, but they told the people doing the wind-down to stop work temporarily, and no one at Saab has been laid off. All this according to sites in Sweden. Something’s happening, you just can’t see it yet.

  4. Saab is kind of like an old couch that is about to be thrown out, and Spyker is the guy who wants to buy it for $100 because he’s convinced he can reupholster it and flip it for $1000 because it’s a “classic”. The Swedish government is the buddy who agrees to pick up and deliver the couch and lend the money to refurbish it.

    My parents once reupholstered an old couch. After a few weeks and way too much money, they realized they should’ve just bought a new one. I don’t think Spyker or the Swedish government is ever going to recoup the money they’re going to pour into Saab (if this deal really goes through), any more than GM did.

  5. If it falls through at this point, looks like GM had rather have NOTHING as Spyker’s offer of $500 million (in all its various forms). Yep, that’s the kind of thinking that got them where they are today.

  6. Moderately sized (less than 100 stores) restaurant chains in the US have been transacted for as much cash.

    GM is financing more than 60% of the transaction price. Which means GM will likely control the Board or Directors of the “new” company.

    And Spyker seems to be borrowing money to keep day to day operation going.

    Hard to believe that all these purported “billionaires” could only ante up $75 million together in cash in all these months.

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