This is the morning after here in central Europe. I did not get too much sleep as I have been chatting with people from different time zones until I literally fell asleep besides my MacBook. The renewed “no” from GM has been a hard hit for Saab and all who are close. We’re surely in high danger of running out of time but still, this does not have to be the end for our tiny Swedish carmaker. Rest assured that Victor is still pushing to explore all opportunities excluding giving up.
The biggest problem right now is time. Reconstruction is in a critical phase. Fresh funding is badly needed to pay salaries and to fund the company for the next few weeks. This would be Youngman’s part and I am not really sure if they don’t want to take the risk of investing even more or if they have certain restrictions from for example NDRC not to put more money in until a successful deal is reached. The fact that they continue to work on a solution and that they are obviously willing to step back in their share shows that they are pretty dedicated to getting a deal done.
GM’s reaction on the proposal was to an extent predictable though I had not nessesarily expected it. Just after the 100 % deal had been rejected there was a say that 19,9 % was the maximun ownership change GM would allow. In total. That means all parties who want to invest just get a piece of that 19,9 %. Not much given the huge investments the partners were going to make. So the recent plan included a “neutral”, pure financial investor, the unnamed Chinese bank as an attempt to ease up GM’s mind.
Sadly, this was not successful and as Jeff hinted in his recent post, several sources indicated that Youngman are now trying to find a solution where they stick to convertible preference shares which would allow them to inject cash but keep them out of the ownership structure. These shares could be converted to regular shares as soon as Saab doesn’t need GM IP anymore. If you ask yourself why this was not on the table earlier – Youngman sure wanted to be more directly involved into Saab as they are likely to invest huge sums. You can’t blame them for that and at least they are still working on solving the situation.
Some may wonder why Victor stated that the original 54 % plan had better chances to get an approval from GM if the barrier is at 19,9 %. At least it would have been a better starting point for talks. I tend to believe that the 100 % takeover plan caused huge irritation at GM and put the intentions of Pang Da and Youngman in a bad light. So now GM sticks to its hard position and wants to see its requirements fulfilled. Victor said that he had warned the parties to try that 100 % thing but they did not believe him. Now it looks like at least some of the involved parties got it and really work hard to find a solution.
Just in case I did not mention this before – Mr Lofalk, please be so kind to face reality, read your job description and start to work for a viable solution for Saab. Would be very much appreciated by a number of people.
On a personal note – I like the fact that the community still uses GM’s facebook wall to air polite requests to let Saab live. But I urge everyone to stay polite, even if that seems hard now. Same goes for the Saab rallies that are being planned on facebook for the 11th. Show your support for Saab, don’t make it an event driven by hate towards someone. Two years ago the Saab community has shown that it can support the brand it loves in a civilized manner. Please make that happen again.