Another Chinese Acquisition Goes Bankrupt -- Saab

Discussion in 'China' started by Armand2REP, Dec 22, 2011.

  1. Armand2REP

    Armand2REP CHINI EXPERT Veteran Member

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    Chinese Firms Lose from Saab Bankruptcy

    (Beijing) – Reeling from the bankruptcy announcement of Saab Automobile AB, Chinese investors are moving to tally up the losses.

    On December 19, a local court in Sweden announced its approval of Saab's bankruptcy application. The following day, Pangda Automobile Trade Co. (SHE: 601258), one of the bidders for Saab, suspended its stock trading in Shanghai for the day. Pangda, the largest auto dealer in China, said in an exchange filing on the same day that it will book a write-down, according to accounting rules, to reflect possible losses from its 45-million-euro prepayment to Saab for car purchase contracts.

    Another Saab bidder Zhejiang Youngman Lotus Automobile Co., a commercial vehicle maker earlier this month provided 34 million Swedish Kronas (US$ 4.9 million) to Saab to help it pay various taxes and fees, according to a report by Swedish newspaper Dagens Industri.

    Pang Caiping, a chief negotiator with Youngman, said in a press conference on December 19 that despite Saab's bankruptcy, the company successfully bought Saab's Phoenix Platform technology, adding it offered value for money.

    Pang also said part of its prepaid capital for the acquisition of Saab will be used to set up a 50-50 joint venture with Saab for auto research and development.

    But at the press conference, when asked whether Youngman can use the Phoenix Platform technology without the consent of General Motors, the previous owner of Saab, a Youngman public relations official said the company has yet to know the specific terms on the technology transfer agreement. :laugh:

    Chinese Firms Lose from Saab Bankruptcy - Caixin Online
     
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  3. Ray

    Ray The Chairman Defence Professionals Moderator

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    Things are getting a wee too serious in the financial world.
     
  4. Armand2REP

    Armand2REP CHINI EXPERT Veteran Member

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    Chinese do not know how to run foreign firms. As soon as they touch them they go belly up.
     
  5. cir

    cir Senior Member Senior Member

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    A bankrupt Saab can now be bought for a song should Pangda(an auto dealer:rofl:)decides to proceed with the bidding?

    This is good news for those who have the money to play。 Right?

    The 45 million euros are prepayment for car purchase contracts,which will probably not be honoured by a bust Saab?The money can still be used in exchange for tech know-how。

    Neither of the Chinese firms in question has a stake in Saab。 How come “Another Chinese Acquisition Goes Bankrupt - Saab”?:rofl:

    And “another”?:rofl:



    Anyway,small pocket changes
     
  6. Armand2REP

    Armand2REP CHINI EXPERT Veteran Member

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    GM owns all the tech rights and they are not sharing.
     
  7. cir

    cir Senior Member Senior Member

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    Saab Automobile Breakup Looms on Chinese Cash Limit, GM’s Snub
    December 21, 2011, 6:37 AM EST
    By Ola Kinnander

    Dec. 19 (Bloomberg) -- Saab Automobile’s assets may be broken up and sold to pay debt as the unprofitable Swedish company ends more than six decades of carmaking following a bankruptcy filing.

    Saab Auto submitted the application at Vaenersborg District Court after a potential Chinese partner wasn’t able to provide funding while General Motors Co., a former owner, said it would block the proposed tie-up, parent company Swedish Automobile NV said today in a statement.

    “There’s no doubt this is the blackest day in my career,” Chief Executive Officer Victor Muller said at a press conference today at Saab Auto headquarters in Trollhaettan. The company’s workforce totals about 3,600 employees, including 3,400 in the southeastern Swedish town.

    Muller has been seeking funding for Saab since his Zeewolde, Netherlands-based company, then named Spyker Cars NV, bought it in February 2010 from Detroit-based GM, which was about to shutter the brand. Muller was in talks earlier this month with potential Chinese financial backers, including Zhejiang Youngman Lotus Automobile.

    The court said in an online statement that it accepted the petition and appointed two Gothenburg, Sweden-based attorneys, Hans Bergqvist and Anne-Marie Pouteaux, as administrators.

    GM’s Role

    GM, which still has a say in Saab’s strategy because of the carmakers’ technology ties, said on Dec. 17 that recent proposals for rescuing Saab were similar to earlier plans that it had rejected as being “detrimental to GM and its shareholders.”

    The U.S. carmaker “made it clear it would not approve of a transaction involving Youngman,” while difficulties with rules on transferring funds out of China prevented a financing deal, Muller said today.

    Muller said that he received “two or three” expressions of interest today from potential buyers, and that he’ll refer them to the bankruptcy administrator that the court appoints.

    “Although this may seem like the end, it is not necessarily so,” he said.

    Saab Auto traces its roots back to the establishment of aircraft manufacturer Svenska Aeroplan AB, which was set up in 1937 and began building cars 10 years later. The auto business was split off from the aerospace operations, now called Saab AB, in the 1990s, with GM gaining a 50 percent stake in 1990 and full control in 2000.

    Missed Targets

    Muller set targets for Saab to sell 120,000 vehicles and become profitable by 2012. Deliveries, which peaked at 133,000 cars in 2006, never met intermediate goals. Sales totaled 31,696 cars in 2010, compared with a target of 50,000 to 60,000.

    The Swedish carmaker’s production lines have been largely suspended since March as the company fell behind on paying suppliers. Saab won protection from creditors in September. Guy Lofalk, its court-appointed administrator, applied on Dec. 7 to end the reorganization, saying the carmaker was out of money and had no realistic hope of gaining financing soon.

    “Saab is so central to Trollhaettan,” said Perry Svensson, a taxi driver in the city who worked at Saab as a welder in the 1980s and whose sister is an assembly-line worker there. “We already have high unemployment here, and this certainly doesn’t help.”

    The government of Sweden pays wages of employees for a limited time. Prime Minister Fredrik Reinfeldt said at a Stockholm press conference today that the state will work to help Saab’s workers “move on to other parts of the labor market.”

    Stock Plunges

    Swedish Automobile plunged 62 percent to 8 cents at the close in Amsterdam. Shares in the Dutch manufacturer, which makes the $235,000 Spyker C8 Aileron supercar, have dropped 98 percent this year, valuing the company at 2.9 million euros ($3.8 million).

    Muller was pursuing a 600 million-euro loan from Youngman and a Chinese bank following a failed attempt earlier this year to sell a stake to the Jinhua(a 4th-tier city in Zhejiang province。So these “big”names in auto-industry are nowadays only worth of a half-hearted rescue from a Chinese mino?:rofl:)-based carmaker and auto dealer Pang Da Automobile Trade Co.

    Other suitors whose talks have collapsed this year include Russian banker Vladimir Antonov, a former Spyker investor seeking to return after GM’s terms of Saab Auto’s sale forced him out, and Hawtai Motor Group, another Chinese company.

    Saab’s suppliers, which total about 900 companies including 75 in Sweden, are unlikely to close as a result of the carmaker’s collapse because its production suspension since March allowed them to adapt, Fredrik Sidahl, CEO of the FKG Swedish car-industry supplier association, said in a phone interview.

    Suppliers ‘Prepared’

    “All the suppliers have prepared themselves for this possibility,” Sidahl said. “Still, I’m worried about the future of Sweden’s auto industry.”

    Volvo Car Corp., the Swedish automaker owned by Zhejiang Geely Holding Group Co., also doesn’t expect any big effects on component makers from Saab’s disappearance from the market, said Per-Ake Froberg, a spokesman at the manufacturer.

    Saab’s creditors include the European Investment Bank, the investment arm of the European Union. The state’s collateral is enough to cover Sweden’s guarantee on the EIB’s 2 billion-krona ($290 million) loan, Bo Lundgren, head of the Swedish National Debt Office, said at the government press conference.

    --With assistance from Johan Carlstrom in Stockholm. Editors: Tom Lavell, Chad Thomas

    To contact the reporter on this story: Ola Kinnander in Trollhaettan, Sweden, at [email protected]

    To contact the editor responsible for this story: Chad Thomas at [email protected]
     
    Last edited: Dec 22, 2011
  8. Armand2REP

    Armand2REP CHINI EXPERT Veteran Member

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    Money is already spent and lost... you lose China.
     
  9. Ray

    Ray The Chairman Defence Professionals Moderator

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    It is quite a mess.

    All seem to have lost!
     
  10. asianobserve

    asianobserve Elite Member Elite Member

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    Somebody forgot to conduct due diligence... :rofl:
     
  11. ice berg

    ice berg Senior Member Senior Member

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    There is always risks in business. No need to trolling because of this.
     
  12. billyong

    billyong Guest

    [h=1]No offence, but when a contry's economy is in danger , a Acquistion went backrupt seems not that important at all.
    India in danger of losing BRIC status
    [/h]Video - Breaking News Videos from CNN.com
     
  13. Blackwater

    Blackwater Veteran Member Veteran Member

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    The most distressed and sad will be Pakistan ,as they are well wishers and brother of chinis...
     
  14. no smoking

    no smoking Senior Member Senior Member

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    On the other hand, they will always act like the pain in the ass of india.
     
  15. trackwhack

    trackwhack Tihar Jail Banned

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    Dude, BRIC is an idea. Its not some strategic alliance. It doesn't add to any of the four nations' appeal or prestige. BRIC status, my foot.
     
  16. Ray

    Ray The Chairman Defence Professionals Moderator

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  17. asianobserve

    asianobserve Elite Member Elite Member

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    Whether this article is accurate or not India needs to be more economically competitive against China. It has to attract the same level of attention from multinational companies to set up operations in India. India is over protective of its local businesses. But why are Chinese private firms doing well despite vast multinational presence in their country?
     
  18. Armand2REP

    Armand2REP CHINI EXPERT Veteran Member

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    Youngman to bid 730 million USD for Saab
    INDUSTRY NEWS | ASH | JANUARY 20, 2012

    The seemingly never end Saab drama took another turn yesterday when it was revealed that a Swedish Government delegation had visited Youngman in China prior to the start of the Chinese New Year to talk about selling Saab to the Chinese bus and car manufacturer. The Swedish Daily Dagens Industri is reporting that a person familiar with the deal is indicating that Youngman maybe readying around 5 billion Swedish Kroner to buy Saab, and will invest a further 5 billion Kroner ($731 million) to develop new models from the Phoenix platform which was developed without any input from GM.

    The original deal to sell Saab to Youngman fell through owing to GM not willing to let its IPR that Saab used fall into Youngman’s hands, as the same IPR underpins Buick and Chevrolet models in the Chinese market. This new deal will apparently get around the GM issue and allow Saab’s to be produced in China and Sweden. The previous deal saw a price of just 100 million Euro attached, so it is unclear why it has now jumped to 731 million USD.

    Saabs United, a Saab fan site are currently mulling over the possibility of Youngman just producing the Saab 9-3 until the new Phoenix based products are made available. What about engines and all the other GM tech? Elsewhere people are pointing to the possibility of buying off the shelf engines from the likes of VM in Italy or Mitsubishi in Japan. But can Saab’s dealership network survive a two year lock down whilst it waits for new cars? It seems unlikely, and it makes Geely’s purchase of Volvo for 2 billion USD look like a steal in comparison. The 2007 launch of the MG7 in China ought to be a harsh lesson to anyone that thinks they can introduce old tech into China and pass it off as new.

    Industry News | Youngman to bid 730 million USD for Saab | China Car Times - China Auto News
     

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