GM strikes deal to sell Saab brand to Spyker

Deal Journal

An up-to-the-minute take on deals and deal makers.

JANUARY 26, 2010

BREAKING NEWS: Spyker Buys Saab for $74 Million in Cash

By Michael Corkery

Dutch sports car maker Spyker Cars has agreed to buy Saab from General Motors for roughly $74 million in cash, according to people familiar with the matter. GM, which confirmed that a deal had been reached, will also receive preferred shares in the new company.

Spyker, which makes only a few dozen cars a year, will contribute $74 million in cash to the deal, while the European Investment Bank will provide a 400 million euro loan ($566 million) guaranteed by the Swedish government.

The deal would mark a hopeful turnabout for for Saab, the Swedish car brand that GM had begun to wind down because it couldn’t reach a satisfactory deal to sell the company.

As part of the deal, GM wil retain preferred shares worth about $326 million in Saab.

Spyker unsuccessfully tried to reach a deal for Saab late last year and returned to the negotiating table this month.

Saab has total assets, including plants, equipment and cash of about 1 billion euros , and liabilities of 528 million euros.

Spyker Chief Executive Victor Muller said in an interview with the WSJ’s Deal Journal last month that he wanted to restore the “Saabish” qualities that have inspired fierce loyalty among Saab owners around the world. Hundreds of Saab drivers have been staging demonstrations in Detroit and Sweden to lobby GM to sell the brand rather than let it die.

Spyker intends to change its name to Saab Spyker Automobiles.

As part of its financing package, Spyker will receive a $50 million loan from Tenaci Capital B.V., which is owned Muller. Meantime, Spyker’s chairman, the Russian banker Vladimir Antonov, has agreed to effectively cash out of the company and sell his shares to Tenaci.

JAN. 26, 2010

BY TIM HIGGINS

FREE PRESS BUSINESS WRITER

General Motors has reached a deal to sell Saab to Spyker Cars NV, GM announced today.

As part of the binding agreement, Spyker will form a new company called Saab Spyker Automobiles and it will carry the Saab brand.

The deal, which is subject to governmental approvals, is expected to close in mid-February, according to a GM statement.

The Swedish government is reviewing the deal and requests for guarantees of a European Investment Bank loan.

"Today’s announcement is great news for Saab employees, dealers and suppliers, great news for millions of Saab customers and fans worldwide, and great news for GM,” John Smith, GM vice president for corporate planning and alliances, said in a statement.

GM did not disclose a sales price.