Saab owes tens of millions, supplier group says

Trollhattan, Sweden (Reuters) -- Swedish carmaker Saab scrambled to resolve a crisis over tens of millions of crowns in unpaid bills today as a production halt ran into a third day.

Dutch owner Spyker held talks with parts suppliers whose invoices it has failed to pay while newspaper Dagens Nyheter headlined its coverage: "Desperate hunt for money."

Saab spokeswoman Gunilla Gustavs said the carmaker is working intensively to get supplies moving again.

"We're expecting that we could resume normal production early next week," she said. "A lot of work is going into strengthening the financial position of the company."

Spyker, which bought Saab from General Motors Co. last year, says the company is not facing collapse but a short-term liquidity crunch.

Spyker CEO Victor Muller and Saab chief Jan-Ake Jonsson both declined to comment to Reuters on progress to sort out payments when questioned outside the plant.

"I do not know how much it (the amount owed) is in total, but we are talking about tens of millions (of crowns)," Svenake Berglie, CEO of the FKG suppliers' organisation, told Reuters.

Andreas Ljungberg, director of Commercial Vehicles at International Automotive Components Group (IAC), which supplies dashboards and other components, said IAC was closely watching cash flow to assess future deliveries.

"Obviously, we have outstanding payments to the degree where we cannot increase our exposure further," he added.

The Saab plant near this town in southwest Sweden was largely deserted after workers were sent home for the rest of the week. The stoppage was set to continue. Berglie said talks with suppliers were not about new credit terms, but getting Saab to pay overdue bills.

"There is a perception in the media that there are discussions on extended credit times and such. But it is not about that, it is about the fact that Saab must pay its bills," he said.

Berglie said Saab was working to sort out its financial difficulties but he was worried about the company's future.

"If they cannot sort out their financial situation, things look very bleak," he said.

Calm on the ground

Fredrik Almqvist, a mechanic at the plant, said he trusted the management to do its best.

"If their (management's) attitude had been any different, they would have thrown in the towel a long time ago," he told Reuters, adding he expected to be back at work on Monday morning.

"When this is resolved production will get rolling again as usual," said Hakan Skott, chairman of the local branch of the IF Metall union.

New stake

In the longer-term, Saab is hoping for an investment from Russian businessman Vladimir Antonov.

Muller has said he wants Antonov back as a shareholder in Spyker-Saab. Antonov has already applied to Sweden's Debt Office for permission to own a stake in Spyker and says he has 50 million euros ($71.5 million) to invest.

Sweden has guaranteed a 400 million euro loan to Saab from the European Investment Bank, giving it a veto over who can own shares in Saab.

Antonov had to leave the original deal for Spyker to buy Saab in early 2010 at GM's insistence after media reports, which he has denied, of links to organised crime.

He said he has cleared his name and that GM, which has preference shares in Saab, has agreed to his return to the deal.

Spyker said in February it would sell its loss-making niche luxury sports car business to Antonov for 32 million euros, so that it could focus instead on the much larger Saab operation.

Only a few dozen of the niche sports cars -- such as the C8 Aileron, which has a list price of about 200,000 euros -- are produced each year.

With the sale of the niche business, the listed company will be renamed Swedish Automobile, Spyker said in a statement earlier today, subject to approval at the annual general meeting on May 19.

From Automotive News (A Crain publication)