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Saab seeks creditor protection

Ailing Swedish carmaker – rescued from closure last year – needs to reorganise and seek funding

Ailing Swedish carmaker Saab will seek creditor protection at a Swedish court so it can reorganise most of its domestic operations and seek funding, its Dutch-listed owner Swedish Automobile said on Wednesday.

Saab, rescued from closure by General Motors in early 2010 by Amsterdam-listed Spyker Cars – which later was renamed Swedish Automobile – has struggled financially for several months, seeking funding from an assortment of Chinese and other investors.

Production at its Swedish plant has been at an almost continuous standstill since April as suppliers refused to provide parts until they received payment. The company also failed to pay salaries in August.

The parent company on Wednesday said Saab Automobile and its subsidiaries Saab Automobile Powertrain and Saab Automobile Tools will ask a Swedish court to appoint an administrator and management will work with him to reorganise the company.

“It will offer full protection to creditors,” said a Swedish Automobile spokesman, adding that protection will come into effect after the court approves.

Saab said it would present the reorganisation plan to creditors within three weeks of filing the reorganisation plan at a Swedish court and it was confident it would get support from creditors for the plan.

Share trade in Swedish Automobile has been suspended, Dutch market authority AFM said in a statement. © 2011 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds