Almost three weeks ago, Saab held their creditors meeting in Vänersborg, Sweden. Only days before, Swedish Automobile (Swan) negotiated for the complete sale of Saab Automobile to the Chinese consortium of Youngman and Pang Da. What seemed at the time like a savior for the company to tired suppliers, dealers, and the Saab community unraveled within days once GM lodged their unwillingness to license the technology that underpins current Saab models, in addition to ceasing 9-4X production.
While all of this has unfolded, North Street Capital (NSC) was working behind the scenes to purchase Spyker from Swan. At times they’ve been prepared to offer a more substantial influx of cash through bridge loans to ensure Saab’s creditors be paid, though these deals were put aside by Swan to focus on a Chinese deal. North Street is aware of speculation regarding their involvement in the sale of Saab. I spoke with Alex Mascioli, Managing Partner at North Street, who wanted to clarify their position in the current situation.
“The great amount of uncertainty which surrounds the sale of Saab has taken its toll on the company. We stand ready to help in any way to ease the sale of Saab Automobile,” he told me from his office in Greenwich, CT.
We discussed how NSC thinks they can turn the company around and restore confidence in the brand. Above all else, Mascioli expressed his concern that Saab remain rooted in Sweden, and that their business plan is sound. “We’re especially mindful of the strain the staff, dealers, and suppliers feel and hope that a deal can be reached as soon as possible,” Mascioli explained. “We really feel for the stakeholders, and watching the situation unravel while solutions are available has been painful.”
A lot has been made of the priorities of bidders looking to purchase Saab and their motivation. North Street may not be experienced in running a car company, but they’re experts in understanding undervalued assets.”Despite its liabilities, Saab still can have a bright future in Sweden. It has one of the best production facilities in Europe, a strong portfolio of current and future products, and is well positioned as the marketplace focuses on right-sized engines and fuel economy. As the Chinese bidders know, the brand’s uniquely Scandinavian heritage makes it an extremely valuable brand and product. We would like to ensure that the company is able to leverage these strengths so that its future in Sweden is secure.”
These statements take on extra significance when viewed in light of GM’s concern about Chinese ownership. It’s clear that North Street’s position not as an OEM but as a financier, has no interest in using GM’s technology for anything other their implementation in Saab’s turnaround. They effectively have an interest in maintaining a positive relationship with GM and all of Saab’s supplier partners to ensure that they will recoup and profit from their initial investment.
At the same time, even though NSC has worked to put together their own deal with Swan, they understand Guy Lofalk and others’ opinions that the Chinese money and market bring a long term stability that Saab desperately needs.
“We’re aware of GM’s concern with 100% change of ownership, and we’re standing by ready to assist in any capacity to help ease their concerns,” Mascioli said. He believes that North Street could add an appropriate balance in a coordinated joint deal to satisfy conditions and reach an agreeable deal with GM and the other stakeholders.
“Each day that passes, the opportunity for a solution dims, and we urge all parties to act quickly in Saab’s best interests. We’re committed to finding a solution that will be agreeable to all parties, so that Saab can pay their creditors, dealers, and staff immediately and get back to building cars as soon as possible,” Mascioli concluded.
SaabsUnited does not have a particular favorite bidder or outcome in this process. Our main desire is that Saab finds a solution which ensures its long term survival and success, building cars in Sweden for global consumption. We have no allegiance to any particular entity, only the cars themselves. We’re eager to see a successful deal reached as soon as possible that guarantees that the company return to building cars in Trollhättan for years and years to come.