There was a really poor article on DI.se over the weekend, which featured in comments but didn’t get any oxygen here on the front page.
DI.se and their sister news service in print really seem to find some joy in sticking the boot into Saab, looking to turn almost anything into a story that doesn’t show them in a negative light.
I’d be surprised if they didn’t have hidden fart-o-meters in certain pairs of executive pants just so they paint even the slightest details in a poor light.
This latest effort features a conversation with Joran Hagglund. It doesn’t always make for easy reading, but you’ve got to see it in the context of the election that’s coming up and the attacks being rained down on the Swedish government by the opposition. We’re now in political mode so everything has to be viewed through that particular prism.
There’s a few people who probably deserve a right of reply to this and they’re welcome to it here, though they might choose bigger media to do so.
My thanks to the semi-anonymous goofball who translated this from the print edition into comments earlier.
State secretary Jöran Hägglund has been hailed as the saviour of Saab.
In a candid DI interview, he reveals his wish for Chinese help in the relaunch of Saab, and is unable to conceal his disappointment at the end result.
He condemns Saab’s reconstruction process, criticizes Koenigsegg’s lies and calls the latest bidding round a joke with unserious players.
Now he demands that Spyker owner Victor Muller accounts for the financiers behind the purchase.
“Pity that it didn’t work out with the Chinese”
Jöran Hägglund, state secretary for Minister of Industry Maud Olofsson, has during the past year been the government’s coordinator of the work with the automotive crisis. The situation turned urgent in February last year, when Saab was put into reconstruction and lawyer Guy Lofalk was set to lead the work of finding a new owner for the company.
“It was a strange process to have some sort of public bidding, and it brought both high and low in for a look. It was like scrambling through the Yellow Pages for automotive companies and inviting them in. And then they still ended up with three. One could wonder why those particular three and no others were chosen. Both Beijing Auto (the BAIC industrial group which was later to buy used Saab tools from GM, editor’s note) and Geely were interested.”
Was it a pity that it didn’t work out with the Chinese?
“Considering that China is the big car market now, and will be for the foreseeable future, it was a pity. It’s no longer the most important to be biggest in the American market, instead it’s about being biggest on the Chinese one. The prerequisite for succeeding there is to be in among the leading, bigger players, and in that context Beijing Auto and Geely are interesting leads.”
And a more interesting lead than Koenigsegg?
“Yes, I think so. Koenigsegg and Spyker have in common that enthusiasts are behind them, and that doesn’t have to be bad, but I think that with the backing that they (BAIC and Geely) have from the Chinese state and Chinese banks, that would be a more long-term foundation.”
How did you react to GM’s declaration of intent to sell Saab to Koenigsegg?
“We were a bit surprised. We met a large number of interested parties, and Koenigsegg was a group that had come together rather quickly. None of the people in Koenigsegg had much experience in the car industry, or in negotiations. After they had bailed out, when we had a follow-up meeting with them, they told us that far into the negotiations, they had missed some important components. So in spite of all the deals, they didn’t have a whole car.”
How were you affected by the question marks about the financing and the role of American Mark Bishop?
“That was negative. We had a big controversy with the Koenigsegg gang along the way. They gave us a false picture of why Mark Bishop bailed out. We figured it out another way, confronted them and explained that if they were to keep talking to us, they should be sincere. That made us lose speed. They didn’t give truthful answers to direct questions. We don’t ask that they should tell the whole truth, but you shouldn’t lie in the face of a negotiating partner.”
Business man with a dubious background
The row concerned that Mark Bishop, a shy business man with a dubious background, was claimed to have left Koenigsegg as an owner and main financier of the Saab bid, but was later, in early fall, found to still be in the game, since he was trying to sell off his Koenigsegg shares.
But Jöran Hägglund stresses that Christian von Koenigsegg wasn’t guilty of the lies, and he doesn’t put the whole blame for the breakdown in the negotiations at the end of November, when Koenigsegg withdrew, on the Ängelholm sports car maker.
“Saab wasn’t a complete company. Saab was basically a cost centre within GM, where costs for research and overhead were dumped. To really find that which was Saab has actually been going on until November, December. So it wasn’t all that easy for Koenigsegg to buy something which wasn’t a finished company.”
What have GM said about the Koenigsegg negotiations now afterwards?
“GM themselves say that they were ‘miles, miles away’ from being completed. There were a great many contracts and details that took time, since Augie Fabela (American financier with a background in Russian telecom company Vimpelcom) who ran the negotiations didn’t have any experience from the automotive business.
After Koenigsegg withdrew, a new process was started with old and new bidders. How do you view that today?
“It was a big joke. We did a background check on one guy who had really been into us. It turned out his company didn’t exist, and he had gone personally bankrupt in October. When we confronted him, he stated that that was true, but that he had forgotten to mention it.”
Were there any of the interested parties that you took to in the December process?
Especially Beijing Auto. What I know is that Beijing Auto are still very interested in a cooperation with Saab, and I think that can turn out very well. We’ve said so to the Saab management and to Spyker.”
How did you regard GM’s decision to wind down Saab?
“I fully respected it, but it became ambiguous when in the same breath, they said that they would look at any bid that came up. I think that from December until now, they crassly started to calculate what a wind-down would cost, adjusted the price to that and wanted to come to a quick conclusion.”
Meticulous vetting of Muller
In the third bidding process for Saab, Spyker were back in, but so too were various consortia such as Luxembourg-based Genii Capital, with Swedish spokesperson Lars Carlström, and a Swedish group led by former vice Prime Minister Jan Nygren. However, that a former political heavyweight, who had also been vice CEO of the Saab defence group, got involved in the process didn’t create any pressure on the Industry Department.
“Not other than that we’ve spent considerable time listening to him and his gang and other interested parties, since we felt that we should at least hear what they had to show for themselves.”
How did Nygren and the other bidders compare to Spyker?
“There’s no comparison. When the bids were to be submitted to GM on January 7, Spyker had a stack of deals and highlighted changes. The Nygren gang had a two-page document, as did Genii and Carlström. Genii’s press release was longer than the bid.”
Was there any serious financing behind it?
Were you alarmed by Muller?
“All the things that turned up, we knew about. We had vetted him meticulously and confronted him. People can have dealings with tax authorities, that happens to Swedish business leaders too, but you have to put it into proportion.”
Spyker have a history of great hopes and weak sales. How did you view that?
“People must be allowed to do business, good or bad. But of course we noted that it would have been better if there had been a big strong industrial player. But there wasn’t one, and then you have to decide on the ones that are available.”
You have handed the question about financiers of the Saab deal on to Victor Muller, but he hasn’t answered. How do you feel about that?
“There could be reasons for that, but I think it’s up to him to disclose them.”
Do you feel that he should give an answer?
“Yes, I do.”
Are you aware of the financiers?
“We have been given an accounting, yes.”
That right there was the most important question of the bunch. The Swedish government were entitled to demand answers, and they received them and approved them. Same with GM.
You don’t need to tell your neighbor what you do for a living, but if you go for a loan, you have to tell your bank manager.
If Victor Muller is in a position where he has to disclose those arrangements, then I’m quite sure he will. If they’re private as the investors wish to stay anonymous, then that’s their business and as long as they’re legally entitled to anonymity, any demands from the press are just posturing. Nothing more.
Back to the article…..
Can you see any reasons why he doesn’t publicly reveal them?
“Not really. Unless there are agreements that mean it’s too soon for various interested parties to come forward. Only he can answer that. He’s the only one who has that picture.”
Are you sure that the Russian Antonov family are out of the picture?
“They are out as part owners.”
Are they out as lenders?
“He’ll have to account for that himself. We can’t do the puzzle through all links backwards, what all the constructions look like, but it has been important to us and to GM that they aren’t in as part owners.”
The Social Democrats have pointed out that the then Prime Minister Göran Persson traveled to Detroit and GM the last time Saab was threatened, and have claimed that Sweden has been represented at too low a level with a state secretary. In connection with Jöran Hägglund’s latest trip to Detroit, critics scoffed that he didn’t get to meet the top GM management. Out of respect for the negotiations, Jöran Hägglund kept quiet and didn’t reveal that he actually did meet GM boss Ed Whitacre.
“I think there has been a great deal of political mudslinging in Sweden. It has also been argued that the Germans sent Angela Merkel, and I can only note that that wasn’t particularly successful. Our conclusion has been that it’s at least as important to have established contacts, a trust and that the opposite party knows what it is you want. We’ve developed that with GM without it having been the Prime Minister who made the calls.”
Have GM asked for higher-level representation from Sweden?
Do you believe in a happy ending for Volvo as well, in the Geely negotiations?
“It’s too soon to tell. Everything can happen in a negotiation. But if they go all the way with Geely, I think it can turn out very well. I’m strengthened in that opinion after having been to China and met representatives of the government.”