Press Releasse: Swedish Automobile Continues Discussions With Youngman

Trollhättan, Sweden: Swedish Automobile N.V. (Swan) announces it is in discussion with Zhejiang Youngman Lotus Automobile Co. Ltd. (Youngman) and a bank in China about an equity interest in Swan. The discussions include a short term solution to enable Saab Automobile to pay the November wages and continue reorganization. The outcome of the discussions is still uncertain. Any possible transaction would be subject to the approval of the relevant stakeholders.

Swan will keep the market informed of any developments.

This just confirms what we have heard yesterday. Now we have to wait for GM and the NDRC to approve it. I hope for the Saab employees that the short term solution is not also awaiting approval.

theSandySaab
Member
4 years 9 months ago

All fingers, toes, arms & legs crossed for a a positive outcome….
And right now I am not picky what “positive” means, anything that can get Saab to build cars again…
Can’t believe this drags on, it’s like the worst kind of tv soap…
Still, I believe in happy endings!
😉

Coke is it
Member
4 years 9 months ago

This proposal with Bank Of China (state controlled) would never have been possible if the NDRC was going to say no to the deal. It all depends on GM.

Come on GM, let Saab go 🙂

tobbe
Member
4 years 9 months ago

“Bank of China” and “Bank In China”…. big differents.

OH
Member
4 years 9 months ago

Swe Gov: ” the government does not have any comments on that Muller is included in the future and that it was not his fault that he received money from the wrong person”

VM sais its not Bank of China, “Its a Bank in China” big differens there.

aop
Member
4 years 9 months ago

Whatever bank that is it should be Chinese.
First milestone would be salaries to be paid today (i.e. signs from GM that solution will be ok).

And I’m not surprised the bank’s name is kept secret until the deal is cleared by GM.

How’s GL this morning 🙂 ?

TurboLover
Member
4 years 9 months ago

GL continues the deconstruction…. ohh sorry, I meant reconstruction of course

Marque
Member
4 years 9 months ago

GL continues the deconstruction…. ohh sorry, I meant reconstruction of course

This is the best joke so far on the GL issue, that hits the nail right in the head. 🙂

saabluster
Member
4 years 9 months ago

“How’s GL this morning 🙂 ?”

Gordon Lightfoot? 😛

nordican
Member
4 years 9 months ago
Keith
Member
4 years 9 months ago

“A bank in China?” Sigh. Just slightly less vague than “a bank on earth.”

The false report (Bank Of China) sounded good. The real report smells a bit like North Street Capital, Shanghai Division.

Tripod
Member
4 years 9 months ago

Pessimistic as usual? 🙂

They can’t share everything with the world this early; at least the recipient of the proposal (GM) should have some minutes to look at the deal before telling everyone and his dog, IMHO.

“False report”? There are always rumours and misconceptions.

Keith
Member
4 years 9 months ago

Come on. The information was untrue. False.

You are quite right though – if it had been reported under the headline “Rumours And Misconceptions” then it would have been a true report.

aop
Member
4 years 9 months ago

Bank Of China name was brought in by Swedish Television.
SU only picked up the news as did Reuters and all other news agencies yesterday night.

Khrisdk
Member
4 years 9 months ago

Well..
Everything reported on Saab /SWAN/SweGov/NDRC/EIB/GM etc. in all media outlets falls under that headline.

So everything is false and untrue until proven true. or viceversa..who cares.
We will know what is going on when the involved entities makes a complete statement.
I suppose we will hear from GM first.
Then lets take it from there.

SaabKen
Member
4 years 9 months ago

OMG Keith, I just nearly choked on my coffee … 😀

Peter G.
Member
4 years 9 months ago

What’s the difference if a Chinese bank is involved instead of PD? It’s still Chinese and GM has problems with that, right?

nordican
Member
4 years 9 months ago

right.

TurboLover
Member
4 years 9 months ago

I would put it this way. In the new proposal VM is in majority as he has been since he bought Saab. Majority means the whole power, i.e. if 0,1% Chinese ownership is OK then 49,9% should be OK too.

SAAB340
Member
4 years 9 months ago

‘should’….
You never know with GM, but I hope you’re right…

TurboLover
Member
4 years 9 months ago

Hope is all I got… :-/

Snowshoe
Member
4 years 9 months ago

Why should they?
Accusing a Chinese bank of being a potential IPR hustler is probably not a good way of doing business in China.

aop
Member
4 years 9 months ago

Agree, that’s why BOC would have been brilliant a move, provided they own shares in GM as well.

aop
Member
4 years 9 months ago

I believe the deal was structured through Deutsche Bank who also dealt with the bids for buying SAAB from GM back in 2009 .
So let’s stay optimists about the Chinese bank, I don’t think there’s a problem there.

Tripod
Member
4 years 9 months ago
Is it shares in Swan or Saab? This article: http://saabsunited.saabklubben.se/2011/12/the-deal-2.html Talks about: SWAN: 50.1% Bank of China: 29.9% (read: bank in China) Youngman: 19.9% The press release mentions equity interest in Swan: “… is in discussion with Zhejiang Youngman Lotus Automobile Co. Ltd. (Youngman) and a bank in China about an equity interest in Swan …” I.e. as in the old agreement, shares in Swan. Perhaps “SWAN” should be replaced by the owners of Swedish Automobile in the other article? But since Swan owns Saab that would mean shares in Saab in the end of course, but Swan can’t have… Read more »
aop
Member
4 years 9 months ago

They will probably issue new shares in SWAN and will sell them to YM and Chines bank.
That would makle current SWAN owners hold only 50.1% of the new shares in SWAN.
Same structure as the deal of last summer.

jond
Member
4 years 9 months ago
I can’t imagine that Youngman will take a minority stake in SWAN, which will then have a majority stake in Saab. Under that scenario SWAN (read VM) will still control the situation and be able to allocate monies as they (he) sees fit. One way they might be able to do this would be by issuing a convertible pref in SWAN, which converts to equity after GM’s IP is effectively antique. But I can’t see GM wearing anything that would give Youngman control of Saab via SWAN, and I can’t see the Chinese investing so much capital without having complete… Read more »
MariusGTV
Member
4 years 9 months ago

Are there any time contraints on signing off this ‘plan’? (i’ll refer to it as a plan as it won’t be a deal until its signed off by the interested parties) I mean, do GM have a certain date when all this needs to be approved or is that date the next time the wages have to be paid?

aop
Member
4 years 9 months ago

It apears that Saab are preparing to replace GL as administrator as he’s certainly bliocking the deal and he’s preparing to end the reconstructions. That’s what they should have done a long time ago, and by now everything would have been in place already.
It’s really sad to see how low this GL can go

http://www.gp.se/ekonomi/1.791079-saabdiskussioner-kan-ge-lonepengar

scand
Member
4 years 9 months ago
If he is blocking the deal, as you say, then he can’t think very highly of it’s chances of success. I still believe, despite the prevailing sentiment here, that his role is to look out for the best legal solution for Saab and its creditors and that can put him at odds with what saabs owners may wish for. A band aid that kicks the problem down the street, or reduces the remaining value of the assets – if it ultimately fails – are things he has to evaluate, as well as simply saving the company. It’s not an easy… Read more »
aop
Member
4 years 9 months ago

Well , it’s not his view of success in any way. His mission was unfurtunately to sell SAAB for peanuts to anyone interested and to get SWAN away of the picture.
And yes, that’s what he’s been pushing through all the way down.

I agree it’s not easy for him in such a high profile case though with so much at stake.

Khrisdk
Member
4 years 9 months ago

In case of a deal and cash reconstruction ends anyway.

scand
Member
4 years 9 months ago

Reconstruction ends when the court sees fit to end it.

Tripod
Member
4 years 9 months ago
Well, he should, as an administrator, understand that Saab has contracts with GM; that Swan has contracts with GM, and should have, if he was looking for “the best legal solution for Saab and its creditors”, tried to create a solution that would work. 100% Geely wasn’t such a solution, 60/40 YPD wasn’t such a solution; it would take quite many trips for GL back and forth to change that, if ever possible. So, he should have come up with something else. Now it seems to some that Swan et al is irritated on the administrator because his solutions would… Read more »
Irish Badger
Member
4 years 9 months ago
I have a problem with this line of thought. Surely GL’s responsibilities are to the company’s creditors and then to the owners (i.e. SWAN). If the creditors are paid off, the company is placed on a firmer financial footing (by paying off the EIB), then there is no need for any further opinion from him and company should emerge from reconstruction. Whether or not the company might be shaky for the next 2-3 years really is irrelevant. Now, if the plan for reconstruction is to defer payment of the creditors for some period, then he would have a say otherwise… Read more »
BoeBoe
Member
4 years 9 months ago

@Tripod, you are right! The Chinese companies will invest and will become part owners of Swan.

They will NOT (directly) own a part of Saab. They are only partly owner of the company that owns Saab.

After this deal Saab will still be owned for 100% by Swan.
(except for the 0.0000005% GM owns)

nichell
Guest
4 years 9 months ago

Prediction: Saab will make a major push in Nov. 2012.

Khrisdk
Member
4 years 9 months ago

Yes, and Sweden will go bankrupt

TurboLover
Member
4 years 9 months ago

A push for what?

nichell
Guest
4 years 9 months ago

Plans to make a push and cut into Audi/BMW market share big time.

scand
Member
4 years 9 months ago
Hmmm. This seems a lot more tenuous than what was thought to be the plan yesterday. Extrapolating on the prior numbers agreed, buying 49.9 percent of swan would be around 66 million eur. (49.9 million for Saab, and 16 million for spyker, till that co sells) Buying into swan does not in itself mean anything for Saab. So how do Saab , which may need to get recapitalized itself, (referring back to the stock liquidity posting) as well as massive funding for all it’s other issues get it, when the majority owner doesn’t have the horsepower of the others? Normally… Read more »
TurboLover
Member
4 years 9 months ago

Bank loan?

scand
Member
4 years 9 months ago

A company in reconstruction cannot take anymore borrowings….

It has to be a recap, ie equity.

TurboLover
Member
4 years 9 months ago

ahh, but of course… *face turned red*

aop
Member
4 years 9 months ago
I suppose you can explain how did you get to those figures? I suspect you probably refer back to the last MOU whcich included Pang Da and which is by now DEAD? In the new plan, Pang Da is not a part owner. Why not looking further back and you will probably get a more accurate picture of what the figures should be , in my opinion. And by the way, Chinese want to buy into SAAB for technology, SWAN is the owner of the technology under the licence agreements with GM. The Chinese cannot directly buy the technology from… Read more »
scand
Member
4 years 9 months ago

100 million eur was the number swan and ym, with others had agreed was the value of saabs shares.

These shares currently have less real value on a daily basis , not more, and buying a minority stake has less value than a controlling stake.

Generally.

If young man want it at any cost, well, that would be different, and normal rules go out the window.

aop
Member
4 years 9 months ago

I know but I wouldn’t count too much on anything that deal was made of.
I think it’s clear that the deal was the only possible exit for anyone before the creditors meeting given the situation in which Lofalk had brought Saab into.
Remember he went out to Geely and propose them to buy Saab for 20 millions. YMPD then proposed the same amount and Swan rejected it.
Back in june, 245 million euro were to be invested in Swan equity by YMPD though.

scand
Member
4 years 9 months ago

Buying saabs shares for 1 kr, 20m eur, 100 m eur or 254m eur is kind of immaterial, from Saabs perspective.

At that moment you, the buyer, are the proud owner of the problem, and at that moment not one cent has gone into SAAB to strengthen its balance sheet in order to pay off outstanding creditors and build a business back up etc.

Buying swans shares, just makes it one more step removed.

Tripod
Member
4 years 9 months ago

Of course, and we all know that; it was discussed earlier this year when some dismissed the 245 MEUR as not being enough. It wasn’t meant as an investment in Saab’s development and to pay debts etc. Everyone ought to understand that. But that isn’t interesting now; it’s about finding a structure that can be accepted by all parties.

talladegan
Member
4 years 9 months ago

“Is it a Bank in China or the Bank of China?” reminds me of “The Judean People’s Front or The people’s Front of Judea” from Monty Python’s Life of Brian!

“Vladimir Antonov? He’s not the Messiah…he’s a very naughty boy!”

TurboLover
Member
4 years 9 months ago

:-)))
as Judas we have Guy Lofalk

aop
Member
4 years 9 months ago

I suppose news agency will try to get a hold of GM’s position’s by now.
Probably news are beeing written already!

OH
Member
4 years 9 months ago

A source sais “It is likely that GM says no to the new ownership solution that will save Saab, since it is just a diversion structure. It says a source familiar with the process to di.se.”

aop
Member
4 years 9 months ago

yes , but that reason is as good as anything else.

From this perspective, any ownership structure will just be another diversiion structure.
Unless of course, Guy Lofalk is the genious behind it

Khrisdk
Member
4 years 9 months ago

Anything is likely.

Nothing is true, Everything is permitted

The diversion structure works if GM accepts it.

Greg Abbott
Member
4 years 9 months ago

This comment makes no sense – the proposed structure was created in response to consultations with GM. And from GM’s standpoint it’s not a diversion from anything — it keeps GM’s intellectual property out of the hands of another car manufacturer and also keeps the cash flow it gets from Saab’s purchases of GM parts alive.

This comment, more than anything else I’ve read up to now, shows that Guy Lofalk has an agenda other than finding the best deal for Saab.

aop
Member
4 years 9 months ago

Someone once made an analigy between the situation at Saab and the political situation in Belgium. I find it quite interesting. Belgium spent more than 500 days without politicians being able to agree on a plan to form a new government.
When nobody was believing anymore in a solution, S&P degraded belgium and the interest rate for government bonds reachde 5.9% putting the country very close to the circle of Greece, Spain, Portugal, the Deal came up !!!
And today it’s oficial , negotiations are completed and a new government will be in place.

Let’s hope the analogy works till the end =)

bpsorrel
Member
4 years 9 months ago

I’m not sure why Antonov keeps coming up. He’s under arrest and if proven guilty will be jailed, most probably in Lithuania. Can’t have any bearing on Saab’s situation now, surely..

If taken at face value, this deal looks promising and doesn’t seem like it would cause GM any major headaches. Some good news around now would be most welcome!! Not sure how much more of this drama I can take! :)))

kochje
Member
4 years 9 months ago

As long as the official announcement states ; ” SWAN is in discussion with…..” it means that NO DEAL has been concluded yet.
So it will just be business as we know now for months.
I do not want to be negative but we need to stay realistic and do not think we are close to a deal.
For me a deal is a done deal, not just anoy=ther plan that needs to be presented to who knows how nay stake holders for approval.

michaelb
Member
4 years 9 months ago

I do not understand then, why the deal was announced here in SU to be finished and just waiting for approval by GM

Khrisdk
Member
4 years 9 months ago

I would imagine that there is a difference in what can be said in a public official press release, and what the actual content is.
As long as there is no definite Yes from GM, there is no deal, and the work done is only discussions to form a basis for that approval.
As the details and formulations count in PR, please note that “the outcome is uncertain”, and “any transaction is subject to approval” is about as far as you can go without an actual approval of the suggested deal

OH
Member
4 years 9 months ago

“The reconstruction can be interrupted at any time, partly because the employees are still without pay in November.
Guy L work with a parallel proposal. but rumor says now now that he is preparing that the reconstruction ends..”

Same source to DI

RS
Member
4 years 9 months ago

Let me guess. His proposal will be based on something insane like; the Chinese Govt buying up 100% of GM so they can sideline SWAN and close down THN…

TurboLover
Member
4 years 9 months ago

hahahahaha!!! 😀

Irish Badger
Member
4 years 9 months ago

GL kind of reminds me of the court appointed trustee for Lisbeth Salander (and you know what happened to him!)…

mr_ebbot
Member
4 years 9 months ago

GM says no to the new deal acording to Swedish Radio.
I missed if was a roumour or a real fact.

Snowshoe
Member
4 years 9 months ago

In Dagens Nyheter it says that GM still says no because they (at least not Cain) have not seen any other proposal than the one of 100% chinese ownership.

A very good answer form James Cain if GM want to have additional time before showing any cards……

In Swedish
http://www.dn.se/ekonomi/gm-har-inte-andrat-sig

mr_ebbot
Member
4 years 9 months ago

Ok, then the radio people couldn´t seperate peanuts and walnuts then…

Peter, Sweden
Member
4 years 9 months ago

Sometimes I doubt journalists can separate peanuts from walruses even ^__^

hans h
Member
4 years 9 months ago

GM says no to the former deal, as I read it. Not the new proposal.

Keith
Member
4 years 9 months ago

While SU last night said there was a deal, Saab’s own press release today just says they “continue discussions.”

The press release implies there is no new deal (at least yet), so there is nothing yet real enough for GM to even consider.

Peter, Sweden
Member
4 years 9 months ago

Yep, you’re correct. GM’s clarification is based on the 100%-deal. The weird thing is that they say that they haven’t gotten any new proposals since then, but on the other hand it’s hard to know when this interview is done and what mails, faxes and letters are delivered to whom.

michaelb
Member
4 years 9 months ago
Off topic, but nevertheless interesting, as it highlights GM’s own difficulties in Europe (directly quoted from Leftlanenews): “GM Vice Chairman Stephen Girsky, who recently took over as Opel’s supervisory board chairman, was quoted by Financial Times Deutschland as saying: “Unfortunately, our plan for making Opel profitable this year did not work.” Girsky is said to be deep in the midst of working out one last plan for Opel with the company’s leader, Karl-Friedrich Stracke. Analysts have stated that Opel’s nine lives are running out almost as quickly as patience in Detroit. Despite the German division’s contributions to GM’s engineering and… Read more »
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