Saab Automobile AB, put up for sale by owner General Motors Corp. (GM), is confident a Swedish court will give it more time to restructure and that one of three remaining potential bidders will acquire the Swedish unit by early summer, a Saab spokeswoman said Tuesday.
Saab later Tuesday was set to apply to the Vanersborg district court in southwestern Sweden for a three-month extension of its reorganization period, which is due to expire Wednesday, spokeswoman Gunilla Gustavs said.
Saab will argue that its sales efforts are going as planned and that it would be wrong to force the company into bankruptcy now. Saab will say that “there are three (potential buyers) that we continue deeper negotiations with, and that they are strong candidates,” Gustavs said.
The Swedish car maker, which GM first invested in in 1990 and fully acquired in 2000, remains confident it will be sold by “early summer,” she said.
Swedish media in recent days have speculated that Saab in the filing would identify the remaining potential buyers to strengthen its case, but Gustavs said that will not happen.
“I can promise we won’t disclose (in the new court documents) who’s left in the process,” she said.
Parties that reportedly may be among the three include Fiat SpA (F.MI), which has said it wants to merge its car unit with GM’s European operations, which include Opel and Saab, to create one of the world’s largest automakers.
Fiat spokesman Gualberto Ranieri said: “The CEO of Fiat (Sergio Marchionne) has already been on the record saying there is an interest in Saab. For the moment, there is nothing to add.”
China’s Geely Automobile Holdings Ltd., and an unnamed German bank have also been cited among the final candidates. Geely couldn’t be reached immediately.
The court is expected to take a few days, at most, to consider Saab’s request. A potential hurdle would be if several creditors tell the court they don’t believe in Saab’s reorganization efforts and that they would rather be paid as part of a bankruptcy process.
Saab last week sent letters to some 700 creditors, offering to settle debts by paying 25% of what was owed, Gustavs said. In the letters, Saab’s reconstruction lawyer, Guy Lofalk, argued that the creditors likely would end up getting at the most 15% of what they were owed if Saab went bankrupt.
Gustavs said Saab is “very optimistic” the court will approve the extension. ” There’s no reason ending the sales process now,” she said.
She also said that Saab continued discussions with the Swedish government concerning its guarantee of a EUR500 million loan that Saab has sought from the European Investment Bank. Saab has said that getting the EIB loan is vital to its survival plan and eventually profitability, but the EIB won’t lend the money without the state guarantee.
“The government wants to know who the new owner is before they approve the credit guarantee,” Gustavs said.
