Jun. 16, 2009 (United Press International) -- General Motors Corp. (OOTC:GMGMQ) said Tuesday it had signed an agreement to sell its ailing Swedish auto producer Saab to automaker Koenigsegg, pending bank financing.
The deal is contingent on $600 million in financing from the European Investment Bank that would be guaranteed by the Swedish government.
Saab sold 93,000 cars in 2008 and filed to restructure itself Feb. 20. It needs about $1 billion to modernize its operations, The New York Times reported Tuesday.
The deal includes a consortium of European backers. Koenigsegg is currently a niche automaker that employs 45 workers and produces a limited number of high-performance sports cars.
The deal is expected to close in the third quarter. But, one industry analyst was baffled by the arrangement.
"I'm struggling to see the point of this deal ... It looks like a short-term solution that doesn't resolve the core issues," Philippe Houchois, at UBS. (NYSE:UBS)
GM, which filed for Chapter 11 bankruptcy protection June 1, has recently sold its Hummer brand, a majority of its Opel and Vauxhall brands, and has buyer for its Saturn brand.
Saab's managing director Jan Ake Jonsson called the development "great news for Saab's current and future customers, dealers, suppliers and employees around the globe."
