Trollhattan, Sweden (AHN) – Swedish carmaker Saab is filing for bankruptcy after a deal to infuse Chinese funds fell through over technology licensing objections from American shareholders. The Chinese deal was the last hope for Saab, which has suspended work at its main factory and has failed to pay employees.
Saab CEO Victor Muller personally filed the bankruptcy papers and admitted it was “the darkest day in my career, probably in the history of Saab.”
“But we had no other alternatives,” Muller explained.
Saab was in talks with Zhejiang Youngman Lotus Automobile Co. Ltd. (Youngman) and a bank in China about an equity interest in in Swedish Automobile N.V. (Swan). However, General Motors (GM) opposed the deal, which would give Chinese investors access to sensitive automotive trade secrets and manufacturing know-how.
As a result, the company announced Monday that, “the Board of Saab Automobile subsequently decided that the company without further funding will be insolvent and that filing bankruptcy is in the best interests of its creditors.”
In a statement, Saab Automobile AB (Saab Automobile), Saab Automobile Tools AB and Saab Powertrain AB filed for bankruptcy with the District Court in Vanersborg, Sweden. Saab expects the court will approve the filing and appoint receivers within weeks.
In the meantime, Saab will continue operating.”We’re continuing to evaluate the situation. We’re determining the next appropriate steps,” Saab spokesperson Michele Tinson told the Detroit News. “It’s a little premature to announce any actions in the United States.”
The filing will be a total loss for Swan, which will completely write-off its stake in Saab.