Zeewolde, The Netherlands, 19 December 2011 – Swedish Automobile N.V. (Swan) announces that Saab Automobile AB (Saab Automobile), Saab Automobile Tools AB and Saab Powertrain AB filed for bankruptcy with the District Court in Vänersborg, Sweden this morning.
After having received the recent position of GM on the contemplated transaction with Saab Automobile, Youngman informed Saab Automobile that the funding to continue and complete the reorganization of Saab Automobile could not be concluded. 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. It is expected that the Court will approve of the filing and appoint receivers for Saab Automobile very shortly.
Swan does not expect to realize any value from its shares in Saab Automobile and will write off its interest in Saab Automobile completely.
Some good news from the US, to follow on from the 2011 Top Safety Pick awards previously given to these vehicles…..
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Trollhättan, Sweden: The Saab 9-4X crossover and the Saab 9-5 Sedan have both earned a ‘Top Safety Pick’ for 2012, the highest rating for crashworthiness awarded by the Insurance Institute for Highway Safety (IIHS) in the United States for a second consecutive year.
“Saab Automobile prides itself on its ability to create vehicles which focus on the safety of the driver and its passengers in real-life situations,” said Per Lenhoff, Head of Safety Development at Saab Automobile. “It is rewarding to be recognized by IIHS for a Top Safety Pick award for two of our newest products.”
Saab’s Real-Life Safety philosophy is based on the fact that no two collisions are ever the same. Saab safety engineers continuously study how Saab cars behave in real collisions on public roads. The results of these studies are the basis for continued development of both design and safety solutions in cars as well as Saab’s in-house crash testing methods.
IIHS (www.iihs.org) is a research and communications organization funded by auto insurers in the US. The test procedures include front impact (offset) and side impact crashes. Seat/head restraints are also tested in a simulated rear-end impact to assess the mitigation of whiplash injuries and the roof structure is tested to assess a vehicle rollover crash.
Performance is rated as ’Good’, ’Acceptable’, ’Marginal’ or ’Poor’ in each of the tests and to achieve a ’Top Safety Pick’ award, cars must achieve the highest rating in all four procedures and should also be fitted with ESP®.
Earlier this year, the Saab 9-4X and the Saab 9-5 both earned a Top Safety Pick for 2011.
Saab confirms that the first payment of the funding, which was promised by Youngman, now has been transferred to Saab’s account. The efforts to secure the remaining funding, needed to pay salaries and continue the voluntary reorganization, continue and the work is moving progressively forward.
So you’ve seen the press release – Our administrator, Guy Lofalk, will file documents today, to end the reorganisation process that we’re currently involved in.
The District Court has registered Lofalk’s application, which has now been posted on their website.
Saab, as well as the creditors who were present at the creditors’ meeting and those included in the Creditors’ Committee, will have the opportunity to express their views before the District Court announces a decision. On their website, the Court writes that Saab’s deadline expires on December 15, at 1 pm. The District Court intends to issue a decision on the matter on December 16, at 2 pm.
Right now, intense negotiations continue with our Chinese investors in Stockholm, negotiations that are intended to strike an arrangement that will enable Saab to continue the reorganisation process and ultimately, continue operations into the future.
This decision from Mr Lofalk is not necessarily the end for Saab. He is under legal obligation to take to this step given the current situation as he sees it. However, that does not stop Swedish Automobile from seeking to put arrangements in place that can sustain Saab through a full reorganisation, and beyond. This is what we are seeking to do right now.
Saab will seek a continuation of the reorganisation process, with a new administrator appointed in Mr Lofalk’s place.
As always, we thank you for your continued support of Saab and we will keep you informed when we can.
Zeewolde, The Netherlands, 7 December 2011 – Swedish Automobile N.V. (Swan) announces it has been informed that the administrator of the reorganization, Mr.< Guy Lofalk, will apply for termination of the voluntary reorganization of Saab Automobile AB (Saab Automobile) and two subsidiaries with the District Court in Vänersborg, Sweden.
Saab Automobile and its creditors have approximately five to six days to submit their view to the District Court before the Court takes a final decision about termination of the reorganization. The management of Saab Automobile will consider future steps and continues the current discussions with Youngman about the necessary funding to pay the wages and be able to continue the voluntary reorganization.
Trollhättan, Sweden: Swedish Automobile N.V. (Swan) announces it is in discussion with Zhejiang Youngman Lotus Automobile Co. Ltd. (Youngman) and a bank in China about an equity interest in Swan. The discussions include a short term solution to enable Saab Automobile to pay the November wages and continue reorganization. The outcome of the discussions is still uncertain. Any possible transaction would be subject to the approval of the relevant stakeholders.
Swan will keep the market informed of any developments.
For those who are interested in the finer details……
You can download a copy of Swedish Automobile’s 3rd quarter report at Saab Media.
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The basics……
• Saab Automobile AB (Saab Automobile), Saab Automobile Powertrain AB and Saab Automobile Tools AB entered voluntary reorganization under Swedish law
• Continued discussions underway with key Saab Automobile stakeholders, Zhejiang Youngman Lotus Automobile Co., Ltd. (Youngman) and Pang Da Automobile Trade Company Ltd (Pang Da) about a transaction which will allow for the necessary investments and secure the longer term future and stability for Saab Automobile
• Conditional agreement reached on sale of Spyker Automotive business to North Street Capital, LP with net proceeds for Swan of EUR 32 million
• Filing for administration of Saab GB Ltd in November to give the company the necessary protection against creditors until it secured the necessary funding for the continuation of the company
• Continuing the voluntary reorganization process at Saab Automobile, continue the development of the revised business plan and restarting sustainable production top priorities for Saab Automobile management
• Depending on the outcome of the negotiations to sell Saab Automobile and Spyker Automotive, several possible scenarios for the future of Swan exist, including but not limited to a voluntary liquidation of Swan.
• Q3 2011 sales of € 75.8 million, Q3 EBIT of € -87.5 million
• Cash generated from operations in Q3 amounts to € -81,1 million
• Sales performance seriously affected by production stoppages and tight liquidity situation during third quarter
• Efficiency improvement initiative launched as part of voluntary reorganization process, in order to create more flexible and competitive cost structure within the Saab Automobile business
• 1,235 cars sold (wholesale) in Q3 2011, compared to 8,540 in Q3 2010, a decrease of 86%
• 2,775 cars sold (retail) in Q3 2011, down 63% compared to 7,430 in Q3 2010
• 130 cars produced in Q3 2011, compared to 9,777 in Q3 2010, a decrease of 99%
Trollhättan, Sweden: Swedish Automobile N.V. (Swan) and Saab Automobile AB (Saab Automobile) announce that Saab Great Britain Ltd (Saab GB) filed for administration with the High Court in London today.
The board of Saab GB is of the opinion that administration gives the company and creditors the necessary legal protection until the required funding for the company has been secured. The appointment of the administrator is effected by the directors of Saab GB. Once appointed, the administrator will take on the management powers of the directors.
Swan received a conditional funding commitment from Youngman for the payment of the wages of the employees of Saab Automobile and for the continuation of the activities of Saab GB. Saab Automobile and Saab GB have not yet received this funding.
TRADING UPDATE SWEDISH AUTOMOBILE N.V. (including SAAB AUTOMOBILE AB)
THIRD QUARTER 2011
Zeewolde, the Netherlands, 18 November 2011 – Swedish Automobile N.V. (Swan), a holding company that owns subsidiaries which produce and sell premium automobiles under the Saab and Spyker brands (together referred to as the “Group”), today issues a trading update for the third quarter of 2011 ended 30 September 2011. The Group is listed on NYSE Euronext Amsterdam (ticker symbol SWAN).
KEY DEVELOPMENTS
• Saab Automobile AB, Saab Automobile Powertrain AB and Saab Automobile Tools AB (together Saab Automobile) entered voluntary reorganization under Swedish law
• Longer term future and stability for Saab Automobile expected after signing of a memorandum of understanding with respect to a EUR 100 million conditional agreement on sale of all shares in Saab Automobile and Saab Great Britain Ltd. (Saab GB) to Pang Da Automobile Trade Company Ltd (Pang Da) and Zhejiang Youngman Lotus Automobile Co., Ltd. (Youngman)
• Conditional agreement reached on sale of Spyker Automotive business to North Street Capital, LP with net proceeds for Swan of EUR 32 million
• Efficiency improvement initiative launched as part of voluntary reorganization process, in order to create more flexible and competitive cost structure
• Finalizing voluntary reorganization process, implementing revised business plan and restarting sustainable production top priorities for Saab Automobile management
• Sales performance seriously affected by production stoppages and tight liquidity situation during third quarter
CORPORATE AND OPERATIONAL REVIEW
Voluntary reorganization under Swedish law
While work continued throughout the third quarter to secure short-term financing, Saab Automobile concluded in early September that, considering Saab Automobile’s limited financial resources and the time needed to secure the required approvals for the investments by Pang Da and Youngman, a voluntary reorganization would entail the best preconditions for using existing resources in the most efficient way. The purpose of the voluntary reorganization process was to secure short-term stability while simultaneously attracting additional funding, pending the inflow of the equity contributions of Pang Da and Youngman.
I know we have some shareholders in SWAN and other interested parties who visit here, so this is important information for them. It’s also interesting for those business-watchers following developments with regards to the sale of Saab.
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Zeewolde, The Netherlands, 11 November 2011 – Swedish Automobile N.V. (Swan) provides further information regarding the sale of the Saab Auto Group and the Spyker business, including the further consequences for Swan.
1. Sale of the Saab Auto Group
On 28 October 2011, Swan entered into a memorandum of understanding (the MOU) with Zhejiang Youngman Lotus Automobile Co., Ltd. (Youngman) and Pang Da Automobile Trade Co., Ltd. (Pang Da) for the sale by Swan to Youngman and Pang Da of the shares that Swan holds in Saab Automobile AB (Saab Automobile) and Saab Great Britain Limited (Saab GB) for an aggregate purchase price of EUR 100 million. In terms of the MOU, the total purchase price of EUR 100 million will be paid in the following manner:
EUR 50 million upon completion of the sale
4 instalments of EUR 12.5 million payable on the first, second, third and fourth anniversary of completion of the sale
Final agreement between the parties is subject to a definitive share purchase agreement (SPA) between Swan, Pang Da and Youngman, which will contain certain conditions. Amongst others, these conditions will include approval of the transaction by the Swedish Government represented by the Swedish National Debt Office (NDO), the European Investment Bank (EIB), General Motors (GM), the National Development and Reform Committee of the People’s Republic of China (NDRC), the shareholders of Swan and several other organisations.
The agreement in principle is that any outstanding intragroup loans and other financial obligations between Swan, on one hand, and Saab Automobile, its subsidiaries and Saab GB (together Saab Auto Group), on the other, will be set off or written off in accordance with applicable law without any actual payment being due and payable. The draft SPA will also be based on the principle that Swan is to be discharged of all Saab-related obligations.
The MOU is valid until November 15, 2011; its validity is also contingent on Saab Automobile remaining in reorganisation. The parties are currently in discussion about the SPA. GM publicly indicated on 7 November last that it will not agree to the continuation of the existing technology licenses or the continued supply of 9-4X vehicles to Saab Automobile following the proposed change in ownership of the Saab Auto Group. Swan and Saab Automobile are currently in discussion with GM. Without the GM consent having first been obtained, it is uncertain whether the parties are in the position to sign an SPA before 15 November of this year.
An important consideration for Swan to enter into the transaction is the commitment of Pang Da and Youngman to provide long term funding to the Saab Auto Group. With Youngman and Pang Da as new partners, the basis for a successful re-start of the Saab Auto Group would be established.
Pang Da and Youngman have assured Swan that their investment in the Saab Auto Group is driven by a business rationale that includes a long-term strategy for the group.
2. Sale of the Spyker business
Swan announced on 29 September 2011 that it had reached conditional agreement with North Street Capital, LP (North Street), a US based private equity firm, to sell to North Street the Spyker sportscar business for a purchase price of approximately EUR 32 million.
Swan is currently in discussions with North Street about the sale of the Spyker business and definitive transaction documentation.
3. Consequences for Swan of the sale of Saab Auto Group and Spyker business
3.1 Use of sale proceeds
If Swan sells the Saab Auto Group and the Spyker business as currently envisaged, the total (net cash) proceeds will amount to EUR 132 million. The exact use of these proceeds depends on the negotiations with the different stakeholders of Swan (i.e. creditors, lenders, etc.). Based on the current situation, the proceeds of the sales will not allow Swan to meet all its liabilities in full. The management of Swan will use its reasonable endeavours to come to a settlement that is acceptable to all its stakeholders, in line with applicable law.
3.2 Future of Swan
The future of Swan will depend on the outcome of the negotiations with the purchasers of the Saab Auto Group (Pang Da and Youngman) and the Spyker business (North Street).
If Swan is not able to complete a sale of the Saab Auto Group or secure further financing for the Saab Auto Group, management will likely not be able to safeguard the continuity of the Saab Auto Group, which will have negative financial implications for Swan and its stakeholders and may result in the bankruptcy of the Saab Group.
If Swan is not able to complete a sale of the Spyker business, Swan may continue the Spyker business, provided that the necessary funding for that business can be obtained.
If Swan were to sell the Saab Group but continues the activities of the Spyker business, as it did before it acquired the Saab Auto Group at the beginning of 2010, it will focus exclusively on the Spyker business.
If both businesses are sold, Swan will consider all of its options (including a voluntary liquidation of Swan).
The fact that the required approvals are not yet secured and that there are currently not yet final binding agreements in place with the purchasers of the Saab Auto Group and the Spyker business leads to uncertainty with respect to the completion of the various transactions described above and thus the future of Swan and any settlement with stakeholders.
Below a best estimate overview of the liabilities of Swan per 31 December 2011 (unaudited):
Most important creditors (amounts in million EUR):
