Saab and parent company Swedish Automobile once again avoided bankruptcy proceedings by paying the white collar workers whose salaries were delayed last month by the troubled automaker.
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Swedish Automobile announced in late July that they did not have the money to pay their salaried white collar workers so the company would have to delay the payment. Well, the labor union didn’t take too kindly to yet another delay in worker payment and the Swedish labor union quickly began taking the steps to pursue a forced bankruptcy against Saab. This was not only done as an effort to acquire the workers’ recent payments but also past monies due should the automaker goes under altogether. Luckily, the company was able to come up with the money to pay these white collar workers and halt the bankruptcy proceedings – for now. This marked the second time that the Saab brand was able to pull off a buzzer-beating payment to avoid bankruptcy.
Saab was able to pay these workers by welcoming a new investor to the company as GEM Global Yield Fund Ltd. purchased a 17% stake of Swedish Automobile for roughly 5 million shares – equaling roughly 7 million Euros. This is good news for now but Saab has been berated by debtors (mostly suppliers) for past due payments and although they have repeatedly found investors, it has not been enough money to restart production. If an automaker can’t afford to make autos, they can only survive so long. Thus far, the company has been able to find enough investors to keep their heads barely above water but as more and more people come to Saab demanding monies owed…the company will eventually run out of shares to sell.
You also have to wonder how many more investment groups around the world are going to be quick to throw money at Saab when they can’t seem to get anything moving right now. It has been a good long time since the company has built any vehicles at the Trollhattan production facility and as the stock of vehicle around the world diminishes – what will Saab do when there are no cars to sell and no shares to entice investors?
Source: Automotive News
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Saab cannot pay salaried workers this month
Saab secures another $35 million loan, production could begin soon
Breaking: Saab sells plant to investment group
Sale of Saab plant to investment firm nears
Saab asks creditors to accept 10% now, 90% in September
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