Spokesman says company has enough money to operate until it is sold
4 June 2009

Saab has enough money to keep operating until it has a new owner, according to a company spokesman.

Saab received $150 million (£131 million) from parent company GM in February, to help it run while it restructured. However, with GM now having filed for Chapter 11 bankruptcy protection, Saab will not receive any more money.

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A spokesman told the Wall Street Journal that Saab had around $90 million (£79 million) of reserves left. "We will have enough to pay salaries and suppliers, to keep operations going until we get out of reconstruction," she said.

Speculation that GM bankruptcy protection filing threatens Saab's sale process was also dismissed.

Saab owes GM around £827 million, but had proposed to pay all debtors around a quarter of what was owed. GM had approved this plan, but there were fears that, following GM's Chapter 11 filing, the US courts now in charge of administering the company would backtrack on the deal.

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"The money (that Saab owes GM) isn't there, so if the court were to demand that, they wouldn't receive it and the only thing they would accomplish is to put Saab into bankruptcy," said the spokesman. "That would be pointless. It's financially better for GM to sell Saab than to demand something they can't get."

Saab is expected to sign a sale agreement by the end of this month.

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