Saab Balks at New Deal With Youngman, Pang Da

Saab 9-4X Grille

Last we heard from Saab, it had received $60 million in funding from North Street Capital. North Street is a private investment firm based in the United States, and has already made plans to purchase Spyker. Saab secured a loan with North Street because it hadn’t received full payment of the bridge money that was due from Chinese companies Pang Da and Youngman. Not receiving the funding was a big warning flag (like nearly everything else that has happened with Saab lately….) about the viability of the deal.

Now we find out the previous agreement has been terminated completely. Instead, Pang Da and Youngman presented Saab with a takeover offer – an outright purchase of all of Saab’s shares. Such a move would likely oust the current management team, and would make Saab a wholly-owned Chinese company. Chief Executive Victor Mueller balked at the offer, leaving Saab in the position it is in today.

$60 million from North Street isn’t enough to carry the company through much of anything. Alex Mascioli, managing partner of North Street, says that he loves Saab and supports it. Speaking with Car and Driver, he said: “Victor Muller will stay on as the CEO. We’re confident in him; this was his baby from the very beginning, and he knows what works and what doesn’t. Our role is just to provide the liquidity and the resources and be the number-one cheerleader.”

To survive and continue with future product plans, Saab needs a huge investment – try around $750 million. Saab says talks with Pang Da and Youngman on another deal are “continuing” but it likely won’t lead anywhere. Their refusal to invest without full ownership isn’t entirely surprising; Saab is a money-losing entity right now with a lot of baggage.

The name still has value, but the main thing the Chinese companies want is intellectual property, which is much more likely to be obtained in a full, outright purchase. Decision on termination of the reorganization process is pending. Saab is appealing the move and asking the court to put a new person in oversight of the reorganization. Unless Saab can pull yet-another rabbit out of its hat, its hard to see where they go from here.


Filed Under: Car NewsSaab


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