Saab, GM and the EIB loan

I feel like where a little bit at risk of paralysis-by-analysis and putting the chance to take action at risk, but there’s also a need for information as well. There’s been a lot of talk in comments about the EIB loan and how the Swedish government should be doing more to help this sale across the line.
I’d love to see them offer more, too, but I’ve chosen to allocate my own scarce resources in the effort to sway GM. Here’s why:
First reason: the Swedes have been clear about what they can and will offer, and my sources tell me that there’s been a lot of work done in the back rooms making sure they can offer it in a quick manner once the time is right.
Second reason: this decision on a Saab sale will be made by GM in the United States. No-one else is responsible for the decision to sell Saab but them and the bidders (who have to put in a viable bid).
Third reason: the Swedes can’t make a decision on the help they can offer a buyer until the buyer is identified by General Motors. GM’s latest ploy of putting buyers off until they come up with EIB-sized funds on their own is a ploy to put it back on the Swedes to help out. They’re creating a chicken-and-egg situation.
I understand that GM have to make sure their future partner in Saab will be viable (they will be business partners for years to come) but they need to identify that partner first, which is what all the pressure is about.
GM’s current task – decide between identifying this party or closing Saab down.

About the EIB process……
We covered this quite a bit back when Koenigsegg were in the driver’s seat (See here and here, for example).
The applicant for the EIB loan was Saab Automobile and the EIB loan was approved based on the business plan submitted, with the idea that Koenigsegg Group would be the owner.
The Koenigsegg Group are reviewed to some extent by the EIB but the focus on the owner is more of a matter for the Swedish National Debt Office.
The EIB really are in a low-to-no risk situation here. The business plan is reviewed quite thoroughly and yes, they want to look at the owner, too. But in the end, they’ve got the Swedish loan guarantees to fall back on so there is no financial fisk for the EIB (just political risk if they loan to someone they shouldn’t have and it all falls over). The EiB and the Swedes need to work together and as we wrote back at one of those previous links, if the Swedes give the tick of approval then the EIB will be fine and dandy.
The real risk is borne by the Swedish government, who get the National Debt Office to review the business plan and the prospective owner/operator prior to offering loan guarantees. They get security from Saab for the loan guarantees and that security far outweighs the value of the loan as long as Saab remain a going concern. If Saab are not a going concern, the value of the property securing the loan is greatly diminished.
As mentioned above, though, the Swedes need to know who the prospective owner/operator is and that decision comes down to General Motors.
I’m sure the Swedes have had discussions and done their homework on the major players who could become owners for Saab. But I believe they also need a decision from GM before they can put their size twelves on and really jump in there.
I’m not letting them off the hook here. I’m just trying to lay out the process. If this whole thing falls over then the Swedes should and will take a lot of flak for being slow in their dealings with Koenigsegg Group. But hopefully they’ve learned their lesson about being slow in the past and will be quick to move if the opportunity presents again.
The ball is in they buyers’ court right now, but they’re about to return to GM, who have the job of making the right decision.

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