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Saab joins forces with a second Chinese group

Saab and parent company Spyker Cars NV have announced that the group has entered into a second memorandum of understanding with a Chinese automotive firm – this time partnering with Zhejiang Youngman Lotus Automobile Co. as the Swedish automaker works to climb out of its recent cash crunch.

When Spyker announced in mid-May that they had entered into the early stages of a deal with Chinese Pang Da to share the distribution and manufacturing tasks for the Chinese market, many thought that it could be the move that saved Saab. Unfortunately, Saab once again halted production at the Trollhattan production facility due to continued supplier problems but those suppliers could be much closer to getting paid as Saab and Spyker cars have signed a new memorandum of understanding (MOU) with Zhejiang Youngman Lotus Automobile Co – a move that will bring in another 136 million Euros ($195 million USD) to the troubled Swedish company.

This new deal with Zhejiang Youngman affords the Chinese company a 45% stake in the manufacturing efforts in China along with a 33% stakes in the distribution end of things. For this right, Youngman will pay 136 million Euros at a cost of 4.19 Euros per share for a total interest of 29.9% in Spyker Cars NV. Last month, Pang Da paid 110 million Euros for a 34% interest in the Chinese distribution and a 10% stake in the manufacturing venture. Currently, Spyker Cars NV holds the remaining 33% stake in the Chinese distribution and a 45% share in the Chinese manufacturing.

Provided that everything goes smoothly with all parties involved (including the Chinese government), Pang Da will end up owning 24% and Spyker Cars NV will hold onto the remaining 46.1%. The problem is that the Chinese government is uber strict about who sells what in their country so it is still up in the air whether or not the government will give the ok to either of these memorandums of understanding. However, Spyker has been very confident throughout this process that the Chinese government will allow these partnerships to commence.

In addition to this new partnership, Spyker Cars NV announced that they would keep production at the Trollhattan plant stopped as they work to reach an agreement with the angry suppliers originally involved with the shortages that have caused seemingly endless production stoppages over the last two months. However, with another 136 million Euros coming in through this new partnership with Zhejiang Youngman Lotus Automobile Co., the future is growing ever-so-brighter for the struggling Swedish luxury brand.

Spyker Cars NV and Saab brand CEO Victor Muller offered the following comment on the tails of this new partnership announcement:
"Having entered the MOU on May 16 with Pang Da, we collectively immediately set out to identify the most suitable (manufacturing) partner to join Saab and our joint ventures. We are convinced that Youngman represents all the qualities required to make Saab and the joint ventures a success.”

Source: Automotive News

Other Saab News:
Saab production stops again
Spyker to become Swedish Automobile N.V.
Saab finds a new Chinese investor in Pang Da
Saab/Spyker partnership with Hawtai Motors terminated
Saab names new Chief Operating Officer for North America

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