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Saab to be purchased by Chinese firms following approval

By: Henry Brier
Posted: 10/28/2011 12:35:00 PM
Referenced Stocks: GM

Woebegone carmaker Saab Automotive is likely to be purchased by two Chinese automotive outfits for the equivalent of roughly $142 million, a deal that pleases the top official of the struggling company's parent firm, according to published reports.

"After the better part of seven months of agony for the company, we have come to a point where we can proudly say that we made it," chief executive Victor Muller with Swedish Automobile said during a conference call , according to Reuters.

Once renowned for upscale drivers, Saabs have not been manufactured for about six months as the carmaker's fate meandered through bankruptcy proceedings in Swedish courts. Its protection from creditors nearly collapsed before two Chinese companies committed to the deal disclosed on Friday. The Wall Street Journal reports the decades of financial trouble came to a head during the past two years.

Should former owner General Motors ( GM ) and authorities in China approve, the deal will see automaker Zhejiang Youngman Lotus Automobile hold a 60 percent stake and car dealer Pang Da Automobile Trade will hold a 40 percent stake of the 100 million euro deal.

CNN reports Saab has been unable to manufacture a car since April because of its financial situation.