Saab Automobile Signs EUR 70 Million Technology License Agreement

Press Release from Saab.

Saab Automobile Signs EUR 70 Million Technology License Agreement.

Trollhättan, Sweden: Swedish Automobile N.V. (Swan) announces that Saab Automobile AB (Saab Automobile) signed a technology license agreement with a special purpose vehicle named Swedish Automobile coöperatief U.A. (SPV). The license agreement relates to the non-exclusive rights in Saab Automobile’s Phoenix architecture technology for a consideration of EUR 70 million.

As part of the transaction, Youngman has also signed a technology license transfer agreement with the SPV on purchasing the license and providing a guarantee for its payment of the license. This commitment of Youngman and the technology license agreement between Saab Automobile and the SPV are part of a bridge financing transaction. This bridge financing transaction and receipt of funds by Saab Automobile are still subject to finalization of definitive transaction documentation with the lender that will provide the bridge loan.

It is the intention to repay the bridge loan with the proceeds of the EUR 245 million equity investment of Pang Da and Youngman, which is still subject to approval of the relevant authorities.

ante
Member
5 years 16 days ago

Saab seems to be a cat with nine lives and each of the lives guarded by a wizard with an army of rabbits jumping out of hundreds of hats!?!?!

I’m speechless!

ante
Member
5 years 16 days ago

… or that Muller bloke and the chinese dudes/dudettes really like this company to survive as much as we do!

Sensonic
Member
5 years 16 days ago

Yep, but they’ve almost used their all nine lives so now they’d have to come up with something new and positive.

aki
Member
5 years 16 days ago

holy cow…..I have to digest this first.

robban
Member
5 years 16 days ago

I actually don’t get it, “special purpose vehicle” Can somebody explain this in understandable terms? I get that Youngman will build Phoenix on a license, but what is SPV?

Jos
Member
5 years 16 days ago

Special purpose vehicle has nothing to do with a vehicle in the literal, automotive sense. It is a legal entity in this context.

Jos
Member
5 years 16 days ago

for a quick definition check this WIKI link

robban
Member
5 years 16 days ago

Thanks!

Robert B
Member
5 years 16 days ago

Robban, a Special Purpose Vehicle is a legal entity, established for the purpose of a particular transaction. The SPV for this transaction is a cooperative with excluded liability established under Dutch law. I understand that the intellectual property of the Phoenix platform is now transferred tfrom SAAB automobile to the SPV. I think the SPV is 100% held by SWAN.

Pedro
Member
5 years 16 days ago

Then SAAB Automobile AB is now, effectively, pretty much an empty shell; just like MG Rover became before “we know what”…

Tim
Member
5 years 16 days ago

Not really. As you can read in the press release the NL based cooperative has bought a licence on the “non-exclusive” rights in Saab’s Phoenix architecture. So Saab still owns the technology.

Pedro
Member
5 years 16 days ago

The way I interpreted the press release was: SAAB —> Sale of Phoenix rights to SPV —-> SPV enters “non-exclusive” agreement with Youngman.

So my interpretation of “non-exclusive” is that the SPV can sell it to whoever is interested beyond Youngman 😉

ivo 71
Member
5 years 16 days ago

Nope, Saab only sold the licence to the co-op. It simply means that Youngman has bought the rights to use the licence for themselves. Saab retains the IP’s and can still decide to share the platform with whoever they want. This is a quite normal transaction in the manufacturing world.

Ivo

ivo 71
Member
5 years 16 days ago

Daap = Saab, of course.

The only reason they hung a co-op in between is that they’d rather avoid re3ceiving funds in Saab’s own accounts right now, i.e. before the reconstruction request is granted.

Ivo

Robert B
Member
5 years 16 days ago

Pedro, I disagree. In my view, the objective of these transactions is to bring more security and comfort to the approval process in China. SAAB is more than SAAB Automobile AB.

Pedro
Member
5 years 16 days ago

SAAB is more than SAAB Automobile AB

That was exactly my point, and my concern lies exactly there 😉

Tilley
Member
5 years 16 days ago

Where did this come from? What about voluntary reorganization?

ante
Member
5 years 16 days ago

Guess it’s not needed anymore… or?!?!

ryanonsrc
Member
5 years 16 days ago

It might be needed still, or not … we’ll see.

Either way: talk about an awesome “middle-finger” response to the court that denied their reorganization application 🙂

ryanonsrc
Member
5 years 16 days ago

Like I said before … Victor Muller is the real deal

The details are going to be interesting but this, my friends, definitely appears to be the missing piece of the puzzle that we have all been waiting for.

Belfast_Saab
Member
5 years 16 days ago

Youngman certainly appear to be behind Saab surviving, very encouraging.

ryanonsrc
Member
5 years 16 days ago

Exactly, they were scrambling this weekend which is immediately before the Chinese Lunar Moon festival. As this is a very big holiday for the Chinese (they even celebrate it here in the US), it’s clear that they wanted to be absolutely sure that this went through before bankruptcy is forced upon Saab.

They would not have done this if they weren’t 100% committed!

Pedro
Member
5 years 16 days ago

The details are not only interesting, but essential 😉

Peter, Sweden
Member
5 years 16 days ago

It’s a joke that the court thinks that SAAB has no future.

tobbe
Member
5 years 16 days ago

+1

JAS
Member
5 years 16 days ago

+1

ryanonsrc
Member
5 years 16 days ago

+1

900 classic cab
Guest
5 years 16 days ago

+1

kochje
Member
5 years 16 days ago

+1

zippy
Member
5 years 16 days ago

+952.8 (Aero)? 😉

Never fight a griffin when it’s backed into a corner as it’ll get nasty.

Nicola
Member
5 years 16 days ago

Nice one! 🙂

marcus
Member
5 years 16 days ago

perfekt! victor muller made the rabbit run out of his hat! this man is genius!

i repeat myself: without vm saab was dead since months!

jouni72
Member
5 years 16 days ago

Yes, He did it again!

alibertism
Member
5 years 16 days ago

+1 – My deepest respect and admiration goes to VM!

Peter, Sweden
Member
5 years 16 days ago

+1

ryanonsrc
Member
5 years 16 days ago

Ok, here goes another “+1” 🙂

Thylmuc
Member
5 years 16 days ago

I decided to only start cheering again when the trust/goodwill problem is solved. Otherwise, the fresh money will be consumed within few months.

ANA
Member
5 years 16 days ago

It doesn’t look like any cash has actually changed hands. perhaps is it some kind of announcement aimed at making a lender more interested in committing to a bridge loan. Or perhaps it is just more ammunition for the court appeal today.

Although it is obviously positive news, I will not get properly excited until saab has either received reorganisation status or has received a bridge loan.

Pedro
Member
5 years 16 days ago
Correct; no money changed hands yet. A more informed comment (instant questions that popped up in my head are inside brackets) would require: (1) To know exactly what the non-exclusive rights to Phoenix consist of (is SAAB preparing to license the architecture to other car makers or just to Youngman?); (2) If this transfer means that the SPV now owns the rights to the architecture (i.e. SAAB Automobile AB was “emptied” of such ownership); (3) If SAAB is to receive EUR 70 million and will repay that money with the proceeds from the shares to be issued to the Chinese… Read more »
Pedro
Member
5 years 16 days ago

And, of course, who has actual control over the SPV?

ivo 71
Member
5 years 16 days ago
Saab sells a non-exclusive user licence to the co-op but retains, of course, the (intellectual) ownership so that the platform can also be shared with others. Youngman buys the licence. But I wouldn’t worry too much, this is just an emergency stopgap solution for an immediate cash need and to negate the ‘we can’t see the money coming’ argument the district court used to deny the reconstruction application. Once Saab is operating again, the development JV iss started up and Youngman have their shares, the relationship will be re-arranged to suit the then de facto situation. As to the repayment:… Read more »
Pedro
Member
5 years 16 days ago
If SAAB is indeed retaining the IP rights to Phoenix, they could have done it directly and using the exact same wording as they used about the transaction being dependent on the “finalization of definitive transaction documentation with the lender that will provide the bridge loan”. That would yield the same results with the Swedish Collection Agency (since the money wouldn’t be entering SAAB until the paperwork is done) and in buying extra time in the appeal front. Why, then, and since I am not familiar with NL Law, use a NL cooperative to do it? What’s the agenda behind… Read more »
ivo 71
Member
5 years 16 days ago
They needed to hang a non-Swedish vehicle in between to avoid the money entering Sweden where it would become subject to haggling about whether it is in a Saab account or not. If the money remains in a non-Saab, SWAN controlled account in Holland then it can be used more freely. But I think this is only a way to be able to show to the appeals court that there actually is tangible money within reach and to eliminate the ‘we don’t see any money coming soon’ argumentation of the district court. Once the reconstruction has been granted, enough money… Read more »
Pedro
Member
5 years 16 days ago

But SAAB could freely negotiate the timing of the loan with the loan provider without having to disclose anything regarding that timing; “finalizing paperwork” is vague enough to not commit to any precise timing and in effect it’s the wording used in today’s press release. The money would never enter Sweden before a Court decided in favor of the reconstruction.

Actually, the only logical reason I see here is related to taxation.

ANA
Member
5 years 16 days ago

It sounds like Saab is selling partial rights to the Phoenix platform to a ‘new company’ (set up by Saab outside of Sweden) so that this new company can sell them on again to Youngman for 70mil euros, the invoice of this deal can then can perhaps be used as collateral against a guarantee for a bridge loan. Or am I missing something?

Pedro
Member
5 years 16 days ago

@ ANA – So it is… Of course that 70 million do not make for much of a collateral other than to support the appeal process; in that regard they can prove crucial.

christian
Member
5 years 16 days ago

Myself and many, many others said it before: What a rollercoaster! This is my first comment in months, as I was just not in the mood of commenting any more at the sight of all these bad news. Now, finally, or should I say once more, there is a small light at the end of the tunnel… I very much liked that quote by W. Churchill someone posted the other day, and it still is so true: “If you’re going through hell, keep going…” Griffin Up!

A-RO 95
Member
5 years 16 days ago

I’m a bit cautious,
1) Why do they need the SPV? Why can Saab Automobile not make a direct license agreement with Youngman?

2) What exactly is involved? Will we now see replicas of the old model 9-3, the current model 9-3 and now the next model 9-3?

liftarn
Member
5 years 16 days ago

1) Don’t know, but as mentioned above it might be to keep the money outside Sweden.
2) The Saab PhoeniX platform, i.e. only the platform the next 9-3 will be based on.

Motoradd's Cat
Member
5 years 16 days ago

Oh dear!

This is what the Rover Group did in it’s dying months.

It sold all of it’s IP to the Chinese piece by piece just to get enough cash to survive a bit longer.

In the end there was nothing left to sell. The rest is history.

Not a good move if Saab is to stay in Sweden.

ivo 71
Member
5 years 16 days ago

No, it’s not. Rover sold the IP rights outright, Saab only sells a non-exclusive user licence and retains the IP rights to Phoenix.

Ivo

Motoradd's Cat
Member
5 years 16 days ago

Point noted.

It’s still not good news though.

Youngman can make cars based upon the Phoenix platform with their own badge on, so they wont need Saab or its Swedish Operations.

Pedro
Member
5 years 16 days ago

This almost begs the additional question of for what will Youngman need SAAB for, once Phoenix is finished, if they can milk the architecture for 10 years under Youngman badges, in the largest car market in the World… Keep the patient nearly comatose, while milking the development side (small loans to the car manufacturing side, funding platform development for a year or so more until Phoneix is ready to go) and then pull the plug… A possible (and increasingly likely) scenario, no?

ivo 71
Member
5 years 16 days ago

Of course. But the Chinese will never buy a car with the Youngman logo for a Saab price tag. It’s not premium enough in terms of local market appeal.

Ivo

Pedro
Member
5 years 16 days ago

Depends on how much they have to shell out in a “vulture scenario” versus what they’d have to pay to get it in some other fashion. If it’s cheaper to act as a vulture and take out SAAB, do you think they will hesitate for more than a half a second in doing it?

Motoradd's Cat
Member
5 years 16 days ago

But their own badged cars will be made in China by Chinese on lower rates of pay than in Sweden so the cars wont have a Saab price tag.

ivo 71
Member
5 years 16 days ago
So what? They were going to build Saabs for the Chinese market anyway. But Saab-labeled Saabs bring a lot more profit in in the Chinese market at the same production cost level. Moreover, if they put the cars on the market as Youngmans then they will never export a single one to any serious market outside of China. Would you buy one? Finally, if they are waiting for the vulture situation then why invest so much money before the bankruptcy? They already pumped like 100 milion euros into Saab, signed an agreement to invest many milions more. What did they… Read more »
Turbine
Member
5 years 16 days ago

Brilliance or perhaps a delaying tactic ?? Remember this extra revenue is from the existing potential investor and not a new income stream….we still need the chinese decision from the NDC very quickly followed by a bridge loan before the cash arrives. All in time to keep off the Unions doing whats good for their members – and nobody seems to have remembered the supplier situation!!!! If I were a clever man I would use news like this to manipulate the SWAN shareprice…..(already done). I think Saab will survive but not in its current form Im afraid – realist

skwdenyer
Member
5 years 16 days ago
Whatever VM’s perceived faults as a CEO of Saab, there is no doubting his creativity when it comes to creating corporate finance deals. Strangely enough, he’s a lawyer with a history in, err, corporate finance 🙂 If this delivers what I think it will deliver, it is quite interesting. It does seem quite cheap for an architecture deal, however, which would be my only concern; for those who recall MG Rover, the putative full-on JV was preceded by a similar technology transfer deal, for a similar consideration, but the JV never happened. So, the plus side is Saab gets to… Read more »
ivo 71
Member
5 years 16 days ago

I think this is a provisional sort of thing, a solution for an immediate need. Once Saab is saved and back on its wheels 🙂 again, Youngman have their shares and the development JV is operating then, I suspect, the financial situation will be re-arranged to suit the new constellation.

Ivo

ivo 71
Member
5 years 16 days ago
It’s a pretty brilliant construction to get the money into Sweden but not via the accounts of Saab. A co-op (wonder between whom?) is established. Saab sells a user’s licence for the Phoenix platform to the co-op voor 70 million, Youngman buys same from the co-op voor 70 million. Youngman borrows the money from a non-Chinese bank (DB?) to avoid in-China trouble with exporting funds in excess of 50 million. Of course, there is that little snag with how to use the money within the co-op for the restart of Saab as long as Kronofogden seizes everything that arrives in… Read more »
kochje
Member
5 years 16 days ago

+1
Victor assures SAAB of 28% of the money that will have to come from the Chinese.
It also binds Youngman even stronger while in fact they give this as an advance on their payment which should come in October.
Victor-up
Saab-up

Piet-Hein S.
Member
5 years 16 days ago

It looks a bit like filling one hole with another:
Saab receives 245M from which 150M goes to creditors. That leaves 95M. Of which 70M is paid back as a bridge loan. That leaves 25M to restart production.

Tough, or am i missing something here?

Jake
Member
5 years 16 days ago

Well… I do believe that that is the case, but that Saab can easily restart production once it has paid all creditors in full…

MariusGTV
Member
5 years 16 days ago
Sorry guys, while I hope (pray would be a better word) that this is indeed the bit of the puzzle that Saab need to keep going, I just can’t help feeling that the Chinese are chipping away to getting a situation like Rover! I want to beleive that I am wrong but just can’t seem to shake off this bad feeling! As for the Swedish governements late assistance, well this is far too little, far too late. Where the hell have you been for the last year or so? I really hope that I am wrong and that all the… Read more »
Pedro
Member
5 years 16 days ago

You mean gently choking the patient to death? That’s a scenario I’ve been thinking of as well…

SwedGov is trying to save face and nothing else, I believe. This way they can come out and say “even though we’re strongly against the Government stepping into processes like this, we tried our best even against our deepest convictions, in order to protect the jobs in Trollhättan” and blah-blah-blah…

TonymacUK
Member
5 years 16 days ago

Presumably the Appeal will still be lodged, as this latest development adds weight to SAAB`s case.

ivo 71
Member
5 years 16 days ago

Of course it will. There is now tangible money coming in soon so this negates the district court’s argumentation to deny.

Ivo

belgian_roadster from Eupen, DG
Member

Monday morning full of inspiration : let’s hope the Swiedish Ambassador to China is a “Don Quichotte”.
….remember??? the one who is fitting against a windmill 🙂

skwdenyer
Member
5 years 16 days ago

I don’t have time to check, but it has just been suggested to me that Swedish Automobile Coöperatief U.A might be registered in the Ukraine, not the Netherlands. Is that correct? And, if so, do we detect the sign of Antonov in this one?

ivo 71
Member
5 years 16 days ago

I checked. Your source is, I fear, an [email protected] who just googled spv.ua and couldn’t read the cyrillic alphabet. .ua, by the way, simply signifies an ukraine-server-located website. Anyway, this is the website of an Ukrainian manufacturer of locks and keys for automobiles. But, well, since VA is buying companies right and left, maybe he owns this one as well? Who knows?

🙂

Ivo

John Mac
Member
5 years 16 days ago

Gents

Have you all noticed how the SWAN share price is effected by SU. When the news broke share price shot up to .98Euro and now after various comments has come down to .82Euro but still up on the day.
http://www.google.co.uk/finance?q=AMS:SWAN#

RobinM as last quote 1 hours ago on Google Finance

For those budding investors should have bought at .35Euro last Friday

ANA
Member
5 years 16 days ago

John Mac
Where do you think SU got the information from?
It was from a press release on Saab’s own media website, and the same release would have been pushed out to journalists, analysts and newswires across the world. I am not sure that SU can claim the glory as they did not break the story.

It would have been a brave investor to have bought any Swan shares on Friday. In fact some would say that it would take a brave investor to buy them today too.

silversaab
Member
5 years 16 days ago

Hind sight is a wonderful thing my Scotish friend

SAABNUT
Member
5 years 16 days ago
For sure a classical V M innovation – providing security and collateral for a Youngman loan,but also effectively moving the SAAB Phoenix technology from the indebted SAAB Automobile AB to a protected shelter – meaning this technology will not perish in the event of a full blown bancrupcy of the mothercompany. (This technology will still be leverage and a valuable asset to sell, cooperate or base future cooperation on / with) Can only see that it aswell will support the renewed recontruction application – showing inflow of fresh capital from the future partner Youngman. Killing three flies with one stone… Read more »
skwdenyer
Member
5 years 16 days ago

The press release, as written, suggests that the SPV has been granted a non-exclusive licence, and it is selling that licence (not a licence to that licence) to Youngman.

Assuming that it is written as it is supposed to be enacted, the SPV will not be left with a licence at the end of it, unless Youngman reneges on the deal.

phermansson
Member
5 years 16 days ago

News flash on SR Väst. Unionen and Ledarna files for bankrupcy.

martinsaab
Member
5 years 16 days ago

So now one thing is for sure: the NG 9.3 must be named “900” … for the 900 lives the Saab cat has 😉

phermansson
Member
5 years 16 days ago

13:08 Saab begärs i konkurs

Fackförbundet Unionen kommer i dag att lämna in en konkursansökan för Saab Automobile, uppger förbundet för TT. Även Ledarna begär Saab i konkurs. Orsaken är att de anställda fortfarande inte har fått någon lön.

ivo 71
Member
5 years 16 days ago
Pedro
Member
5 years 16 days ago

LMAO! 😀

Jos
Member
5 years 16 days ago

Same here.
+many

phermansson
Member
5 years 16 days ago

13:08 Saab is forced into bankruptcy

Workers’ Union The Union will today file a petition for Saab Automobile, said the Association of TT. Even leaders requested Saab bankrupt. The reason is that workers still have not received any wages.

Pedro
Member
5 years 16 days ago

In practical terms, what is the consequence of this request in terms of SAAB management filing its appeal?

phermansson
Member
5 years 16 days ago

They say that it’s an application and the regret they have to do it. But it will take some time to handle their request and they hope that the court appeal goes through, then they will cancel their petition.

Pedro
Member
5 years 16 days ago

OK, so no immediate practical consequences since the procedures run parallel to one another. Still, this is quite a signal in this that the unions are losing trust in management, as the unions are probably as interested as the SweGov in saving face and washing their hands in case the worst case happens…

Jos
Member
5 years 16 days ago

will today file a petition

That’s still future tense. It has not filed it yet, and even if it has (which it is legally obliged to do, as I’m told) the court wil not rule on that same day. Fat lady must be getting confused now, on stage, back off stage… My guess is she ain’t gonna sing. Keeping fingers crossed

phermansson
Member
5 years 16 days ago

Future mayby, but the Unions leader just spoke on the radio and the application shall be handed over today, she spoke like it’s already was done.
But that’s true, the ruling will take time and the fat lady has to wait.

TurboLover
Member
5 years 16 days ago

“Fat lady must be getting confused now”

Hahaha 🙂

Baracuda
Member
5 years 16 days ago

Oh no. The Unions are forcing Saab into bankrupcy. :-/ http://www.ttela.se

Peter, Sweden
Member
5 years 16 days ago

They are not “forcing”, they are handing in an application for bankrupcy later today. It’s also said that if/when salaries get paid, or if Saab get a YES about the reconstruction, they will withdraw their application. If bankrupcy IS the case, the ruling will take as long as 4 weeks (which would be long enough for VM & C:o to do their stuff).

Baracuda
Member
5 years 16 days ago

Hm ok. Thank you for your clarification Peter. I am hoping for the best.

Griffin up!

phermansson
Member
5 years 16 days ago

The application will take a few weeks to handle they say, so it’s indeed parallel processes.

cakewalker
Member
5 years 16 days ago

I thought we knew all this last week? The rush over the appeal application seemed to be related to the Unions’ imminent filing of their bankruptcy petition. The only difference is that I’d understood they were due to file the petition tomorrow, not today.

peeceepeh
Member
5 years 16 days ago

Good to read. So it’s 9 1/2 lives, then. At least.

OliverH
Member
5 years 16 days ago

This could be also a part of an exit strategy (SWAN vs. Saab Automobile AB). This could end in a no to the appeal and reason for bankruptcy demand from Unions.

spacy
Guest
5 years 15 days ago

.
It could also be Asset stripping

wpDiscuz