Spyker Buys Saab
Tortured sale process finally over for Saab, Spyker and GM
By Brendan Moore
Spyker Cars NV, the tiny Dutch supercar manufacturer, and the last potential buyer for Saab, has finally struck a deal with General Motors to buy Saab.
Rumors of a sale were rife Sunday night, with many different sources stating that the deal would be announced yesterday, but that didn’t happen. Later in the day yesterday, Ed Whitacre, new CEO of GM, said at a GM press conference that, “GM does not have a deal” and “has not changed direction” on shutting down its Swedish unit.
He said yesterday that GM was still moving forward with the orderly shutdown of Saab. This, despite the fact that sources in Sweden were still reporting that a deal was imminent.
It is thought that the deal is structured as reported yesterday, but with a lower transaction amount, with Spyker paying GM a total of almost $400 million USD. The purchase price roughly breaks out as follows: $326 million in preferred shares in the next corporate iteration of Saab and $74 million in cash.
The European Investment Bank will provide a 400 million euro loan ($566 million), intended to secure the purchase and provide some operating capital, guaranteed by the Swedish government.
Part of the deal financing package is a $50 million loan from Tenaci Capital B.V. to Spyker in order to provide a piece of the cash component of the agreement. Tenaci Capital is owned by Muller. Additionally, as GM stipulated, Spyker’s current chairman, the Russian banker Vladimir Antonov, has agreed to effectively cash out of his shares by selling those to Tenaci, on his way out the door.
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.
Spyker was Saab’s last chance for a rescuer, as unlikely as they may be as a rescuer, given that they have around 110 employees, and Saab has approximately 3400 – a vast difference in size. It’s a bit like the minnow swallowing the whale.
Spyker had only one other serious rival for Saab at the end; an investment firm named Genii Capital, whose bid for Saab was spearheaded by Bernie Ecclestone, the head of Formula One. As late as Sunday night, Genii was making public statements about being “ready to pounce” if Spyker’s bid failed, but then abrubtly withdrew from the bidding process yesterday, saying, “Genii Capital believes that the timing of the next stage of the shutdown process at Saab is not compatible with its requirements for putting in place a solid business platform for the future and closing the transaction.”
The prospects for turning Saab around are daunting, but Muller believes that Saab can be “very profitable” if Saab sticks to its core values as an automaker. Still, Saab is a small company in the world of very large auto manufacturers, and in a market where bigger brands than Saab have already left the scene recently, and, consolidation is still occurring, Saab is going to have a tough road ahead of it.
Spyker’s ownership of Saab is merely the beginning of the beginning of the next stage of struggle for Saab to be viable and profitable.
Spyker intends to change the name of Saab to Saab Spyker Automobiles upon ownership.
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