Talks going on in Stockholm *UPDATE

Some quotes from as mentioned by RedJ in comments:

According to the TTELA CEO Victor Muller and administrator Guy Lofalk today meet representatives of the two Chinese companies, Youngman and Pang Da in Stockholm.

All on one table. Good.

Saab’s cash is virtually empty and without money from Youngman, the company simply can not continue reconstruction.

Exactly why not Youngman-money already received is unclear. It may be that you do not agree on contract design. But it can also be as easy to come Youngman wary since it became known that Guy Lofalk brought parallel talks with Geely.

The Geely-track, which Lofalk apparently drove without Saab management’s knowledge, seems to have reached an impasse. This, as reported to TTELA – and it is also true with the statement Geely did this weekend.

Therefore, the Saab back to its original plan, which is about to get Youngman and Pang Da as a partner.

Technology License Agreement with Youngman involves using Phoenix technology for next-generation Saab models as collateral to obtain funds from the Chinese company “in advance”.

At today’s meeting must convince Youngman Saab’s management not to pull out. In particular, it reports that the government could bail out the mortgage limits for the government loan guarantee, that is, including Saab’s production equipment and spare parts company, and then sell them to anyone who should have done that Youngman hesitate. They are therefore within the agreed advance payment of 640 million.

It might well be that Youngman/PangDa were not to happy about the talks with Geely. I hope that all are now back to working on the initial plan to get this done. Now.


UPDATE from Jeff

Suddenly things seem a little sunnier at the negotiating table in Stockholm.

“Work [is coming] along nicely. There are no plans to replace Mr. Lofalk,” Victor Muller told TTELA, while he and Guy Lofalk negotiated with Youngman and Pang Da in Stockholm. 

If Saab’s reconstruction would be interrupted ends the stay of bankruptcy against the company. Normally when a district court the bankruptcy negotiations within two weeks by Judge Cecilia Tisell in Vänersborg.

After the Union, IF Metall and leaders withdrew their bankruptcy petitions, the members have since received a salary from the government wage guarantee, the only bankruptcy of the subcontractor Takata-Petri.

On Tuesday afternoon it had not received any request to replace the administrator or to stop reconstruction.

The right to request that the reconstruction will cease, Saab (debtor), creditors (creditors) and the administrator.

There is no provision that Saab must ask itself in bankruptcy if the reorganization is terminated.

 “Mr. Lofalk is doing a good job. Any ambiguities that arose last week have cleared up during Tuesday’s meeting,” said Muller about Monday’s negotiations.


It’s nice to see everyone working together on a plan forward. This isn’t that complex of a deal when you break it down. Saab has new IP not owned by GM (Phoenix) which was loosely based on Epsilon but is now an entirely different beast (as opposed to reports we’ve been hearing from Autocar). The Chinese have known this from the get go, this isn’t some new cog in the gears of the approval process, if it had been an issue it would have been brought up far sooner. This is more about who gets the rights to the tech when and how. That’s what they’re working on at the table now, and that’s what we’re hoping they can iron out ASAP.


111 thoughts on “Talks going on in Stockholm *UPDATE”

  1. That the Chinese were not happy with what has happened over the last few days is understandable, I posted a comment weeks ago that the Chinese will not stand for being messed about. Fingers crossed that Lofalk hasn`t cocked things up!

    • TonymacUK
      Lofalk hasn’t cocked anything up – it was well and truly cocked-up months before he came on the scene. Cut him some slack ,he is clearly working for the best interests of Saab.

      • I would say that depends on POV.

        Trying to bring another partner that Youngman in, even if Pang Da was also involved can not really be considered helpfull in negotiations when they are now forced back to Youngman.

        If I were Youngman it would change my view of the situation a bit.

        • I respect that however my POV is that Youngman have missed numerous deadlines and as far as I can see none of them can be blamed on Lofalk. I am not sure why there seems to so much negativity towards him – he has nothing to gain by Saab’s failure and he is obviously working hard to secure a good future for Saab.

          • I’m not really negative towards Lofalk, but if he was the active part in trying to bring in Geely, he made a gross misjudgement of their intentions and has probably damaged the deal with Youngman, or at least made it a little bit harder
            Naturally given that we can trust the statements from Geely.

            At the moment it doesn’t really matter as the only option seems to be Youngman/Pang Da, and that Lofalk is now working on that line together with Saab management

            My own little speculation is that the small Chinese manufacturers from the same province aka. Geely and Youngman sat down, had a nice little chat and made fools of SweGov who thought they were in control.
            But that is just my POV

          • It has seemed like Lofalk has got quite a bit of criticism stemming mainly from how he was positioned in the media and on this website over his meeting Geely (why??). From what I can see Geely wanted to explore opportunities and I do not believe for one minute they travelled to meet Lofalk ‘out of politeness’ as they stated. What must be understood is that it is his legal duty to conduct such meetings and if he could have secured a better deal for Saab then he would have been a hero in many peoples’ eyes.

            I agree with you that that this is now water under the bridge as the focus seems to be back on Youngman and Pang Da. I sincerely hope it works out.

  2. This is not good at all :(:(

    “Now, warns a senior director of NDRC of China, Chinese companies to invest in Saab. “They should adopt a cautious approach,” said the assistant manager, according to Bloomberg News.
    Chinese companies should adopt a prudent approach to investing in the Saab Automobile.

    The words are from Chen Jianguo, deputy director of Industry Coordination of NDRC in China – the powerful ministries that must approve the business with foreign companies, reports Bloomberg News.

    – It depends on how it can be implemented. It is dangerous if there is an abyss, said Chen Jianguo, in an interview in the city of Chengdu on Tuesday.”

    • Maybe the statement it is all part of negotiations. How knows. I can’t tell anymore.

      One think is sure though; China will become extremely powerful in a near future as the government have full control over what is going on with the companies and their investement; it is all part of a master plan!

      Meanwhile in Sweden…

    • I don’t see this as negative. In fact I agree with Mr Chen. From their point of view there is clearly no point in throwing good money after bad at Saab unless they can be completely assured of the action being taken to turn the Company around to at least breakeven on a realistic estimate of sales. Surely the prudent course of action from the Chinese point of view is to agree the action being taken under project Cheetah, but to wait until the NDRC have deliberated before investing any more money. At that point, assuming a positive outcome, they will have voting control and can micro-manage the situation.

    • Yup saw that one, seems to be based on the comments above from ‘a senior director of NDRC ‘. To be fair, Youngman must be worried if Guy is goig=ng behind theri backs to Geely and today threatening to pull the plugs? On the other hand,is not Youngman miney ringfenced against creditors? I would have though there were strings attached in the event of bancruptcy?

      • So the Chinese Government would only approve the deal if there was a full IP ownership transfer? At least that’s what I interpret from the article and (off topic) is fully consistent with broader-scoped news about China (change in investment focus targets)… The Chinese master plan is now threatening to bite them in the ass despite (and simultaneously because of – the beauty of Economics!) having some 3 trillion USD in currency reserves…

    • From the article:
      “… as the sale does not include the acquisition of any new intellectual property rights. Former Saab owner GM already has a deal to transfer Saab’s Epsilon production line and tooling to its Chinese partner firm SAIC.”

      Of course, Saab has never invented a single thing, if they say so, it must be true… Gee.

      • This relates to my previous comment above;

        The Chinese government just feels that buying into a technology is just a waste of money if their is a very similar technology already licensed by another Chinese company.

        China is not a free market!

        • That’s not really a big surprise is it?

          But apart from that FWIW I don’t think it changes anything in the ongoing negotiations or the NDRC decision.
          I know that is just opinion but Hey ..everybody seems to have one at the moment.

  3. The fat lady will know her role on Oct. 14th, right? Either it goes through and she returns to her cave or it doesn’t go through and she gets her long-delayed time in the spotlight. Standing on rumors in the meantime is a good way to fall and hurt yourself.

  4. Saab chief executive Victor Muller told Reuters in a phone text message: “Things are moving along fine and we do not intend to request the replacement of Mr Lofalk as administrator.”

    The fat lady has sat down to her notes again.

      • I’m sick of this quote from a bloomberg source who hasn’t even posted an article. They’re quoting a bloomberg piece that was never published. Moreover, the lost in translation nature of the quote is plainly clear. Remember the last time the NDRC said to be cautious? That was when they were basically explaining that Youngman had priority and not to overbid. That’s all they’re doing now, making sure Youngman/Pang Da get a fair deal and Geely doesn’t bid up the sale. Reading into it more than that based on 0 facts is fruitless.

        • I agree 100%, Jeff.
          Apart from that, as usual quotes out of context is as we know quite useless; and a lot can be lost in translation, as you said, not to mention with differences between cultures, different businesses, terminology etc. Also, another thing to remind about is that comments are not always presented as “news” in the order they happened, i.e. chronological, and that can change the perception quite a lot, for obvious reasons, if one isn’t careful.

          • Jeff, Tripod: I also agree.

            Given that approval has already been received at the local and provincial levels, and this whole process appears to have been fast-tracked. As such it seems highly unlikely that the NDRC would dissaprove of the deal on some weird basis such as AutoCar UK suggests. So, this is yet another example of journalists not having a clue what they are talking about.

  5. If GL stays seated and the Chinese stay seated and VM stays seated….then the FL may not get her moment in the spotlight. Keep everything crossed that nobody stands up to walk away.

  6. I don´t belive the reports from media, they just wanna make money out of this.

    We must stay calm right know and follow the process.
    Something says to me that this is gonna work out well.

    • This could easily be misinformation to give the Chinese a stronger position. However is it possible to get a weaker bargaining position than Saab is in right now?????

      • It could be.

        Or the media has “misinterpreted”. NDRC maybe just talk about this deal and media enlarges.
        I mean, I read this morning a article about that Muller is “DESPERATE” with the whole thing with Lofalk.
        Now this afternoon I read that Muller is happy with Lofalk and that he´s doing a great job.

        Everything is just contradictory.

        • And everything is created by the media.

          Of course, it can be a missunderstanding between Muller and Lofalk, and something in this are true but far awat from the reports.

          Like we say in Sweden “Making a chicken from a feather”

      • Yes. Saab in bankruptcy will – it is reported – have no rights to the name. Without the brand, what else is there?

        £53m (as at 18th July 2005 worth €77m according to, or about €87m now allowing for inflation) was paid by Nanjing for MG Rover’s remaining assets, including the leases on the buildings (but not the land itself, which had already been sold-off). This did not include the exclusive right to produce some models (25 and 75, a license for whose IP had already been sold to SAIC), nor the 45 (whose IP remained with Honda), nor the engines (license also sold to SAIC previously). That also didn’t include the Rover brand (retained by BMW, later sold to Ford), but did include MG and a bunch of historical nameplates; nor did it include the spare parts business, which had already been sold to Caterpillar, but it did include the engine manufacturing line.

        So that gives us an idea of what the underlying asset-base might be worth – at least a data point!

        Saab’s production facilities are smaller, but more modern, and their IP is arguably more valuable. But anything above €100m seems hard to achieve in a fire sale.

  7. Man, this sure is gut wrenching.

    If it should not go as planned this week, I wonder what VM’s other plan is. He’s crafty at pulling that next rabbit out.
    I hope it does not go to the next act, and thing progress smoothly from here.

  8. Zippy posted an article from Autocar earlier. While Autocar is a decent enough car magazine, it is NOT a financial journal, or even a newspaper with a financial section. Any article of this ilk is based on information they have gleaned from other sources, which could even include SU. So I am taking the article with a pinch of salt.

    • Not sure what that article adds TBH, as it is factually wrong; the Saab deal will give YM/PD new IP.

      Or is the argument that the €70m bridging loan would provide access to the IP, so why pay the rest? That, of course, depends upon the precise detail of the agreement VM hammered-out with YM about the license agreement. If he had any sense, he’d have made sure that the default position (i.e. YM gets the IP if Saab goes bust) did not include the scenario in which Saab goes bust because YM/PD don’t invest.

  9. So… since there should always – if possible – be a ‘Plan B’ to any negotiations, what might it be?

    Well, the first question is, if EIB are prepared to call-in (UK term for ‘cancel’ in this context) the loan, that leaves SweGov owning the debt. They do not have to take on the collateral at this time; they can, instead, opt to sell on the debt to anybody who will take it. Even if they do convert the debt into shares, or alternatively just seize collateral, what will they receive for it in cash?

    So, if SweGov are being pragmatic, they will want to consider whether they can sell-on the debt at a discount to its face value. What might that discount be, and who might want to take it on?

    Alternatively, if all parties agreed, a non-confrontational debt-for-equity swap could be arranged, giving SweGov a majority stake which they could sell-on, again – presumably – at a discount to the EIB debt amount.

    That would open things up for buyers who right now require NDO approval to benefit from SweGov’s loan guarantees.

    • I think EIB can call-in the loan, then SweGov sell the debt to Youngman, let Youngman 100% own SAAB.
      that will let the process move fast.
      because this case will be same as Ford/Volvo/Geely. NDRC has no reason to reject.

      If they say SAAB’s technology is similar like SAIC, then Volvo’ technology also based on Ford platform.

      • Indeed. But that depends upon the terms of the loan – can the EIB call it in at this point? Are Saab in breach yet?

        Of course, that doesn’t really help, does it? YM might put in, say, €1-200m to buy out SweGov, but none of that money will go into Saab, so it just increases YM’s costs of doing the deal. Unless, of course, they can re-finance this as group debt.

        • money will not be big problem for Youngman.
          I think uncertainty is the thing Youngman/Pang Da fear most.
          They paid again and again, but SAAB did not resume production as promised .
          Do not know what happens next is. supplier problem? employer problem? or otherers

          • fido
            You seem to think Youngman has cash lying around and that they can spend it when they wish… This is not the case – they need to raise it and also get approval to use it.

          • If they get the approval from NDRC they should have the needed money lying around or be able to raise it
            This is another Egg and Hen situation, just from another perspective

          • The statement is that certain conditions have not been met.

            That seems plausible, especially considering that infamous Bloomberg/Autocar/ article quoting a NDRC representative.

            They are proobably not totally in agreement about the terms of the deal with the Phoenix IP
            Which is the one bringing the €70 Mill

          • The longer winding and absolutely personal speculative reason:

            The €70 mill depends on the deal with the Phoenix IP

            That IP is a Saab asset, that is not supposed to leave lightly when under reconstruction.

            Both side incl. Lofalk wants to make the best deal for either Saab, Saab management or Youngman and respecting the laws at the same time
            I has probably been so difficult arranging this deal that Lofalk tried to work around that setup by contacting Geely.
            That line didn’t work, probably for the same reasons

            So now they are back at the table trying to get it to work.

            Pang Da probably don’t care who the producing partners are, so they will work with anyone who are willing to make the deal

            But, I repeat, that is only my speculations

  10. About Asian culture: they “talk and talk and talk” – but when they finally comes into action, things happen fast (since everybody has come to the same conclusion). In Sweden we believe that “a contact is a contact is a contract” – and that´s very much it. In Asia, especially in Japan, a joint decision takes time – and a contact is due as long as “nothing else happens that affects the deal”. This is something important to consider when doing business abroad.

    I feel sorry for Youngman/PangDa who must be very confused by all the fuzz and strange speculations back and forth! And I do not think that they can even imagine that the Swedish people them selves actually can spread can spread malicious rumors – only to hurt themselves! (Really – what sane person can undestand that?!)

    I heard that Maud´s successor

    will do everything in her power to support SAAB

    • As a chinese, I can not understand why swedish government does not support the sweden automotive industry.Why not the Swedish government direct injection of capital to Volvo/SAAB, help them, as U.S government did to GM & Chrysler.

      • and swedish media looks very funny.They seem can’t wait to see SAAB/Volvo die.They continue to spread the bad news, some of them just rumors, Don’t they know this is hurting their country’s brand? I have not been to Sweden, I have not even been out China. but i known SAAB by Griffin badge on a car, i known sweden by SAAB, then i known IKEA also from Sweden, and Ericsson, i known Oh Laura by SAAB ad ‘release me’, and i love it. then i bought a book written by a Taiwanese, a travel book, all about Sweden, by reading that book, I was deeply in love with the Sweden.I hope someday I can travel to Sweden to see SAAB factory and museum, to see Aero X & 9-x Air.Even live there.
        If SAAB is gone, then i will never have a chance to buy a pure sweden made SAAB 9-5, then I might not go to Sweden, because that special feeling is lost.

        For some people like me, SAAB is symbol of Sweden, it is worth to be saved.

        sorry my bad english

  11. A couple of thoughts regarding the NDRC claiming they already have the epsilon IP… so no deal with Saab.
    1) It has been public knowledge since the inception of Phoenix that is was derived from the GM Epsilon architecture. I can’t imagine this this is new news to the NDRC after several months of reviewing Saab and the proposed deal.
    2) From my understanding, the architecture has been changed so dramatically by Saab that the Phoenix truly is its own platform with IP that is independent from GM. If GM could claim IP ownership, they would have by now and disqualified the Phoenix being sold, used as collateral or part of JV assembly negotiations with a Chinese automaker. GM is privy to the SAAB/YM/PD agreements.

    I think this is the same speculative BS that has plagued Saab for the last 3 years since GM put the brand under strategic review.

    • i remember when Mr.VM want JV with HUATAI auto, Huatai’ CEO told to chinese new paper about Phoenix platform, what he said is, Phoenix not 100% owned by SAAB, There are seven technical staff belong to GM. he said he wish to corporate with SAAB to develop that technology and replace them to get rid off GM.

  12. .
    I think the big problem here, is what VM did with the rights to the IP of phoenix, when trying to get YM to hand over 70mil.

    What he transferred into the Dutch company, is still unclear, but YM deal was to be with that company & not Saab. Was it the rights to the IP or just the rights to sell it’s use.

    Often the movement of assets , just before bankruptcy, will/can/could be challenged by other Saab creditors.

    I always thought that YM/PA were to buy into Saab [once the NDRC] approval is complete & that included the IP of Saab, being they would own jointly 70%..

    Rhe administrator cannot allow such deals to go without scrutiny, as the IP is a large part of Saab’s assets.

  13. Note to any Saab personnel who may be reading this site:

    PLEASE, no jumping the gun announcing tentative deals as confirmed before the ink dries. This may be part of the reason every time something seems promising the deal falls apart. Heck, even if talks are proving to be promising, don’t even say that you think the deal will be finalized; just comment that talks are ongoing and show promise and leave it at that. Doing otherwise can queer the negotiations and cause your would-be partners to walk away from the deal.

  14. Don’t believe what you read in the papers, especuially not when uít comes to Saab,
    I usually have good faith in Autocar but this report is a hotch potch of misunderstandings and insinuations on the same level as Swedish Consider this:
    Youngman and Pang Da met the NDRC before last weekend, according to interviews with mrs Pang, to sort things out. Why would an NDRC guy go out making those claims instead of telling YM/PD themselves diredtly then.And about the intellctual propertiy issue about Epsilon Autocar are completly lost in space. The current 9-3 is based on the Epsilon (1) platform which has also been allowed for Chinese GM partner SAIC – right. But it has also been allowed for BAIC since they bought hte basic current 9-3 (pre-2008) from Saab with GMs permission. The Epsilon (1) is the base for the Phoenix architecture, but Phoenix is very different and not an IP of GM anymore so ttherefore can be licensed by Saab only. What Saab cannot licence is the Epsilon 2 architecture used in the new 9-5 which is owned by GM, and I don’t think they intend to either.

    Another recent fake news story that comes to my mind is the one where a Geely PR executive says that Geely has absolutely no interest what so ever in aquiring Saab. While at the same time his boss Li Shi Fu is in Stockholm for negotiations about a deal ( which luckily don’t succed).

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