Press Release: Saab and Spyker Enter Into MOU With Pang Da Automobile

Saab Automobile and Spyker Enter Into MOU With Pang Da Automobile On Distribution/Manufacturing Partnership For China And Equity Participation

Trollhättan, Sweden – Spyker Cars N.V. (Spyker) announces today that Spyker and Saab Automobile AB (Saab Automobile) signed a Memorandum of Understanding (MoU) with Pang Da Automobile Trade Co., Ltd (Pang Da), China’s largest publicly traded automobile distributor with over 1100 dealerships nationwide. The MoU includes a strategic alliance consisting of a 50/50 distribution joint venture and a manufacturing joint venture (MJV) for Saab branded vehicles as well as for an MJV-owned brand (the so-called ‘child brand’) in China. Saab Automobile will have up to 50 percent in the MJV, with Pang Da and a to-be-selected manufacturing partner owning the remaining shares.

Pang Da shall make a EUR 30 million payment for the purchase of Saab vehicles and is expected to make an additional EUR 15 million for the purchase of more Saab vehicles within 30 days subject to certain circumstances. Additionally, Pang Da will take an equity stake in Spyker for a total amount of EUR 65 million at EUR 4.19 per share (the weighted average of the ten last trading days), representing 24 percent of Spyker on a fully diluted basis, and will have the right to nominate a member of the Supervisory Board of Spyker and /or the Board of Saab Automobile.

* Spyker, Saab Automobile and Pang Da signed an MoU on the formation of a joint ventures with respect to distribution and manufacturing in the Greater China market, subject to definitive transaction documentation and certain regulatory approvals.

* Pursuant to the MoU, Pang Da will transfer EUR 30 million to Saab Automobile as payment for the purchase of Saab vehicles and an additional EUR 15 million within 30 days for the purchase of additional vehicles depending on certain circumstances.

* Pang Da will take an equity participation in Spyker for a total amount of EUR 65 million at EUR 4.19 per share representing up to 24 percent of Spyker’s outstanding share capital on a fully diluted basis.

The MoU between Spyker, Saab Automobile and Pang Da contains the principles on which the parties will establish a 50/50 joint venture for the distribution of Saab-branded vehicles in China.

The EUR 65 million share subscription by Pang Da will secure Saab Automobile’s medium term funding.

Some of the transactions following the MoU are subject to agreement on definitive transaction documents and certain conditions, which include consents from certain Chinese governmental agencies, the European Investment Bank, GM and the Swedish National Debt Office.

With the receipt of Pang Da’s EUR 30 million initial payment, Saab Automobile aims to come to an agreement on payment and delivery terms with its suppliers as it secured the liquidity that is required to restart production as soon as possible. In order to improve lead times to customers and dealers on existing and future orders, Saab Automobile will work together with its suppliers to minimize any impact from the recent production stop.

Victor Muller, CEO of Spyker and Saab Automobile said: “Both parties are confident that this partnership allows Saab Automobile and Pang Da to create a strong business, initially in the distribution and subsequently in the manufacturing of Saab vehicles in China.

“Pang Da is a forward-looking, profitable and well-capitalized public company that, as the single largest automobile distributor in China, sees enormous potential for our brand in their home market. We will work hard to finalize the relevant agreements and firmly establish Saab in the world’s fastest growing car market. Pang Da taking a substantial equity stake in Spyker underlines their confidence in our plans for the future and China in particular.”

Mr. PANG Qinghua, CEO of Pang Da, said: “This partnership allows us not only to distribute Saab, the iconic European premium brand, in China but also to set up a manufacturing joint venture which will further enhance the competitive position of the Saab brand in China.

“With the new products Saab has launched since it became an independent car manufacturer early last year, such as the all new Saab 9-5 and the Saab 9-4X which have been widely acclaimed, and not in the least the upcoming successor to the current Saab 9-3, we believe the timing is perfect for Saab to enter the Chinese market. Our size, financial strength and competence in addition to our ability to move fast will be crucial to Saab’s success in China.

“Having just gone public ourselves three weeks ago, we are delighted to have the opportunity to become a substantial shareholder in Spyker, Saab’s parent. We very much look forward to collaborating with Saab’s management to successfully enter our promising home market.”

81 thoughts on “Press Release: Saab and Spyker Enter Into MOU With Pang Da Automobile”

  1. Ok sense of positivism. BUT we have to wait another week (or couple of more) if they (have to) broke this MOU again or not…

  2. Congratulations Victor ! The MOU sounds good. With this partner I have a better feeling about intellectual property because it seems to be more focussed on distribution.

    • This will give them some breathing space to start production and time to come up with all the approvals.
      And the to-be-selected manufacturer for the joint venture might very well be Hawtai again.
      They stressed interest in Saab, have money, technology and production capacity…
      Note… these are my thoughts, it is not allowed to use them on any other media except (Just in case some journalists uses it for a speculative headline)

      • I think i will be a very smart solution for Saab and their Chinese partner(s) to get things up and go first like this. The prodiction can start again soon, and that is (i think) very important to get a permanet working solution. 🙂

    • But the EIB is still in the mix – and where are Hawtai – is that now dead and buried? The EIB obviously do NOT want Antonov anywhere near SAAB, so we can`t count on his offer, but is that offer still being considered?

    • Agree for 100% with your short but meaningful comment.
      VM has an enormous energy that he puts in his strategic view; make Saab a strong company and do that in a different way.

    • “China’s largest publicly traded automobile distributor with over 1100 dealerships nationwide.”

      That should not be an obscure entity. Imagine if each dealership sold just 100 Saabs a year 🙂

      • It is obscure from a Western point of view, I am a bit tongue-in-cheek here. I am afraid the Pang Da dealerships would sell 100 “MJV brand” cars a year rather than Saabs.

        • I see your point. However I´m quite confident that the Chinese have a great sense of brand awareness – otherwise there would not be joint-ventures with players like MB or BMW methinks.

          What I like the most about this deal is that the Chinese partner is as quoted the LARGEST publicly traded car distributor. It´s thus not like dealing with an also-ran.

    • I have read somewhere that Pang Da imports over 70 brands. So I guess it’s a pretty big and well known company in the car industry.

  3. “…as well as for an MJV-owned brand (the so-called ‘child brand’) in China.”

    Are they talking about a new co-developed sub-brand for sale only in China?

  4. I guess this deal will not fail because VM has learnt about the mistakes in the Hawtai affair. Congratulations Victor !

  5. SAAB & Spyker have just signed a “Memorandum Of Understanding”,
    Let’s wait until the final deal is finalized and signed off.

    Hoping to celebrate once the production re-commences and hoping to see more SAABs on the roads.

    Best Wishes,

  6. This must mean that Victor pulled out a smart Joker in the shape of a giant vehicle purchase, to get around the obstacle of getting a new owner aproved by authorites. Very clever! 🙂

  7. Congrats!

    Howver, what about the existing agreement for distribution in China. Who was that with and what will that amount to? How does this deal compares with the Hawai one?

    Seems this one doesn’t bring in as much money, or am I right? Sorry to put some gloom on the situation… It’s great news for sure, but I would guess Saab needs about 50€ million just to restart production. 30€ million is in the bank already (from Gemini), but some 30€ million more from China and only about 65€ million more for the “deal”. Half the money that the Hawai deal would have brought to Saab, although the stake is about 25% vs. 30%. That´s about enough for about another six month.

    And no Antonov related news, EIB come one!

    Anyone up for an analysis?

    • rask,
      there is always the half full and the half empty glass point of view.
      Hawtai was willing to pay up to 120M€ for a maximum of 29.9% of the stokes, so maybe the 120M € could be only 100 M €.

      A week ago, Saab was selling the shares to Hawtai at 4.88 €, now due to the Hawtai failure only a 4.11 € price has been achieved.

      I don’t think the deal is that bad, if we put it in context, further Pang Da will be paying in front 30 – 45 M € for Saab cars they are buying, this is money nobody can’t stop.

  8. Again the idea of entering the worlds largest automobile market – with widespread distribution and together with a solid partner and eventually local production in order to get within the custom barrier of China, is the obvious and right step for SAAB.

    The investement in SAAB must be considered as a bargain – the chinese partner get access to world class
    technology and know-how, which will save them hundreds of millions of EUROS if compared to starting from scratch and develop it on their own.

    As a SAAB enthusiast I still hope for an independent SAAB, having its epicenter in Trollhattan and in Sweden – which I believe is in no contradiction of having local production in China and possibly Russia.

    But the road to safe grounds is still ardeous and long:

    As pointed out by SAAB – this is a medium term recapitalization . more money will be needed

    The future of VA and his partownership and refinancing (and if they come into place) his own plans for the future?

    The ties with GM – that mostly affects the present generation of SAAB cars 9 3 and 9) 5 series – both in terms of IMP and patents and the GM investment in SAAB
    SAAB will have much more liberty and options in the future and in choosing their path forward with the next gen of SAAB 93 . where they will own the IMP in full.

    The EIB loans and restrictions linked to them – will SAAB be able to fullfill their business plan and recapitalize with the loans in place and under the collateral terms linked to them?

    The joint venture in China must succeed – giving the investor a good return just as SAAB need to benefit aswell – in terms of increased sales and cost sharing.

    Anyhow – as good news as you could hope for and still bringing hope.

    I think its vital that SAAB take their market and consumer information very seriously – and get it right!
    Also their staff, suppliers and retailers deserve the best in terms of information and updates.

    As much as I like V M and admire his energy, creativity and optimism, he must be aware that he’s now responsible for 1000s of employees, subcontractors and dependants – there is little room for mistakes and megalomania.

    I do however think Viktor Muller is the right man for the job right now, but later he should bring in a reputable team of associates from the automobile industry to accompany him.

    V M is at his best promoting, selling and inspire – now he have to take the SAAB comunity the final steps
    of recovery and secure the future for this iconic brand.

  9. I am a bit cautious with that news, I did not find the brand even by google. But I still hope that this will work as real solution. Keep fingers crossed.

    • It´s no car brand – Its one of the biggest distributors and car dealer of china .
      And if you can read between the lines of this press relase they already have ordered cars of an amount of 30 mio euro. for the first step. and are able to purchase cars for 15mio eur within the next 30 days. so saab has sold aprox 1800 cars in this deal
      (for 1100 dealerships). The car purchase needs no approval through NDO and EIB and swedish state

      the joint venture has to be approved first

  10. I do not want to be negative here, but no website exists for this Pang Da company – all I get in Google search is traditional Chinese medicine used as laxative and rash.
    The website mentioned in the press release cannot be accessed.
    I would rather have patience until Great Wall or another more serious company can get all necessary approvals in order to enter a business with SAAB. Announcing MoUs every 2 weeks affects credibility and image very seriously.
    If we want to sell cars and be profitable it takes more than SAAB fans as customers, infinitely much more marketing efforts, and in order to produce it takes suppliers to trust the company (companies) that run it.

  11. Given the fact, that the present Spyker owners will give away 24% of equity for a relatively modest amount of fresh capital (65m EUR), and that the 30m EUR is just upfront cash for cars to be delivered some months later, it gives the impression as if Spyker shareholders have the idea that funding issues are or will be resolved (soon).
    Aside from the fact, that we are talking just of a Memorandum of Understanding, which is legally not binding, this is surprising.
    Where the heck that optimism? Do they know something about the EIB’s decision? Do they have sufficient deep pockets, that can cover all the big needs – in sum certainly up to 1bn EUR? Surprise, surprise.
    Such an agreement with a big distributor in China might in fact make a lot of sense, no dout about that. But aside from some short-term money, it will mainly cover long-term distribution and sales issues.


  12. I read this as something very positive. At least EIB cant stop Saab from selling prepaid cars!

    Congratulations all involved!

  13. hope hat the clever trick of buying cars instead of loans will stand up to the scrutiny of all parties involved. In a way it is of course a loan where by the pay back installments are cars so pay back in goods and not cash.
    There is far to little communication/information on the position of the comapny vis a vis EIB and also vis a vis antonov.

    The powerplay/ gambling first with the swedish creditors inspired in his own words by VM and now hopping from one MOU to an other does not have a very high flavour of professionalism albeit of high energy of all people concerned.
    To my experience paying late in Sweden is a nearly deadly sin where one should not gamble with and all swedes are aware of! He issue of a short cash position was something everybody should have seen coming a long time ago with the dramatic sales against bad prices.

    So I think VM has shown on the one hand that he can put a deal together but on the other that execution of plans and running a company is not his strongest talent. He said as much in the Eindhoven presentationthat he gave
    Furthermore he must have been warned for what would happen by all swedes in his companies.
    So I think he should stick to his talents , being inspiring,creative,dealmaking and hand over asap the running of the company to others

    Hope this MOU is under better controle then the first one and let’s keep our fingers crossed as will the thousands of people that depend on the outcome of this process

  14. Seems this one doesn’t bring in as much money, or am I right?

    That depends how you look at it. It;’s a Brilliant move IMHO, becuase as I read it, PangDa directly puts an order in for 30Million€ worth of new cars, thus the possible avoiding delay by regulatory approvals (which would be tha case if they merely wanted to enter an ownership relation) but allowing to inject a heap of cash into SAAB directly, and allowing them to start up the plant. This has the biggest priority.

  15. If I ever go to jail I want Victor to represent me. This guy is really good.
    Each time I drive my SAAb I get why this brand should continue.
    It amazes me I never get bored with the car—-even after 5 years.

  16. What ever it takes to get the factory going. I sure hope the suppliers are willing to smoke the peace pipe with Saab (one more time) and start the deliveries asap. I have a feeling Saab wont forget those who pulled in the same direction -when the company is selling 200.000 Saab-Saabs worldwide, Trollhättan is running at full steam and making the suppliers very happy they stayed on board during the difficult first two years of independence.

  17. Great news!
    Fingers crossed for everything to work out this time!

    Good also that there apparently are several interesting companies. We need some healthy competition to help Victor secure a deal that also is a really good deal for Saab and Trollhättan. 🙂

  18. A nice way to start the week. Well done VM. Keeping fingers crossed for a long, prosperous and mutually satisfying business relationship.

  19. Congratulations Mr Muller!
    This deal seems simular to the one Saab made with Philipssons back in the 1950`s. Money up front for cars they wanted to sell.

  20. It would also make sense to make such a deal for example with Beherman for a quick cash injection.
    they sell about 500cars a month (belg and nl)

  21. afaik if a chinese company owns a part of an western automaker, part of the production must be in China, is that correct ? they are a distributor but with shares at Saab they become automaker, does that mean a production plant in China ? Or are there more parts of the puzzle which remains hidden …

    • Pang Da is a distribution company, not a manufacturer, so production does not need to be in China.

      Having worked and lived in China for years, I can see Pang Na looking into a future where they are not only the largest auto distributor, but also have a manufacturing facet to their business, thus vertically integrating their business and diversifying at the same time. If it all works out, this is good news for Saab.

  22. Amazing how VM never seems to run out of business ideas, and how he is able to build bridges, not destroy them.

    I wonder wether this order will get priority treatment at the factory. After all, they can hardly take the money and then use it to pay supplies for other clients’ cars.

    • I mean that is what they need to do to pay their debts, but will the next round of deliveries after the suppliers are payed and restart delivery be used to build China-targetted cars?!

  23. I am really happy to read this news eventhough I have not had the time to go through the details. Thanks Victor, I hope this time we won´t be frustrated again in a couple of days. It is clear that the future of many car companies lies in China and in order to survive Saab needs to sell cars there, so it seems an encouraging solution. Now the next news I want to read is when the production will get started again.

  24. I will celebrate once the relevant authorities have signed on the dotted line. Saab needs long term financing to survive though and that’s not even on the radar.

    • “Long term financing” needs to come from vehicle and technology sales, not from investors. If that is not forthcoming, no amount of deal making will save them. But in the short term, they need to get production going.

      If 80,000 vehicles really does bring them to break-even, as has been said, then a return to their traditional 120,000 unit volume should bring good money. Peter Augustsson once told me that costs were roughly 1/3 factory overhead, 1/3 engineering, and 1/3 purchased supplies and components (cost of goods sold). So 40,000 units, with a half to two thirds of the wholesale price going straight to the bottom line – there’s your long term financing.

      • Well, now it’s apprently 50% supplies and components, 20% factory overhead, 10% development and the remaining 20% is other overhead (admin, sales costs). Figures taken from Spyker’s annual report. Saab is incurring considerable costs to build every unit – straight accounting gives figures of up to EUR 22K per vehicle, but this probably isn’ t the case, as there would have been virtually no margin left.

        • I am sorry, I mixed up my accounting. The EUR 22K figure refers to REVENUE per vehicle (so now you know how much your dealer’s making on selling one to you 😉 ), the straight material/component costs are around EUR 16K (EUR 12K if you take out internal settlements with Saab Parts).

  25. Just yesterday I was bitching about no news on SU about what was happening with Saab. I guess I need to eat some crow. We shall see if this turns into a real agreement. But this agreement makes sense to me.

    I initially thought last year that Saab should go to Roger Penske in the United States for the same reason as Saab has now gone to this Chinese company. Penske had tried to acquire Saturn but finally backed out of any deal because Penske was a distribution firm and not a manufacturing firm. Penske wanted nothing to do with manufacturing; Penske wanted product and backed out when it saw it couldn’t get any without taking over Saturn’s manufacturing.

    I still think VM would still do wise to contact Penske to see if Penske would be interested in selling Saabs in his dealer network similar to this company. But maybe Saab’s reputation in the US would have to improve some before Penske would be interested. On the other hand, maybe if Penske sees that someone else is willing to take the leap in a big market like China, and Saab looks like it can really deliver on production, Penske might be willing to jump in also. If not Penske, then perhaps others.

    For info on Penske see:

    Interesting — it says that Penske is the second largest dealer network in the world with about 250 dealerships. Does that mean this Chinese company is number 1 with 1100? If so, no doubt Penske knows about them.

    I hate to see the Chinese take Saab over (if that is what ultimately happens down the road) but at least the take-over is by a distribution network heavily involved with other prestigious brands. Maybe it will be more intent on selling cars than manufacturing them and maybe will have little intent on even making parts for them. Let us hope that is the case.

    I don’t want a Chinese Saab. I also don’t want a Saab assembled in Sweden from Chinese parts.

    If this company will stay out of the auto manufacturing and concentrate on the sales and distribution of cars, this could work long term for Saab; especially if Saab partners up with other large dealer networks around the world. That could be an ingenious business plan.

    • @david please don´t speculate too much and read the press release carefully
      the pangda deal is much better than the hawtai deal.

      first of all – saab isn´t owned by a chinese company – they only would have 25 %
      they only sold 1300 cars…. no phoenix ,no technology…
      the joint venture with 65 mio euro has to be approved by EIB and NDO – but they have still to announce and make a deal with another chinese car manufacturer.

      VM really made the best thing he could with the strong regulations from EIB and Sweden.
      sell cars. SO he sold 1300 cars on one weekend ……

  26. SAAB_Andee:

    Did you read what I said? Apparently not. I am well aware that Pang Da did not buy Saab. Not Yet. Maybe never. But if it happens, 25% can easily turn into a 100% when the company is in dire financial straits. And of course it is a much better deal than Hawtai. How could you interpret what I said any other way?

    Of course this purchase of stock is also conditioned on the sale of Saabs which may or may not take place.

    Apparently, some claiming to know Chinese deals, say that a Chinese MoU is next to worthless.


    So according to some who claim to know how the Chinese operate, VM has got a long way to go before he has sold any cars in China, much less 1300.

    Don’t know anything about this website, but there clearly are people skeptical about this deal.

    Frankly, I can’t imagine the Chinese government not having some say-so (veto?) in what gets exported there. The Chinese don’t have the huge imbalance of trade they do because of open markets. China is a closed shop.

    Seems like no one here, in his enthusiasm to have Saab succeed, bothered to take a look at what skeptics might be saying.

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