TROLLHÄTTAN, Sweden—The main SAAB automobile factory in Sweden stopped production a few weeks ago when their liquidity crisis led to the company being unable to pay their subcontractors. According to Svenska Dagbladet daily, the company was on the brink of bankruptcy and looking everywhere for salvation.
The first step was a 30 million euro (US$43 million) loan from the Gemini Invest fund, which was used to pay off the subcontractors, according to what SAAB Chairman Victor Muller told Swedish Radio (SR). The loan can be converted into stock. A new partner with capital was still needed, however.
From out of nowhere, Chinese car manufacturer Hawtai appeared, and negotiations were carried out at record speed, beginning last Friday, and concluding on Monday.
The deal gives Hawtai 29.9 percent of Spyker, the company that owns SAAB, and access to SAAB’s network of retailers. The price tag: 150 million euros. The partnership will be far-reaching, and Hawtai will also gain access to SAAB’s next generation technical platform. SAAB, in turn, will gain access to the Chinese market.
The Beijing-based Hawtai Motor Group is a new and relatively unknown company, founded in 2000. It has two factories and a production capacity of 350,000 cars a year. Like many other Chinese car manufacturers, the company has been accused of stealing designs from established brands. According to Mr. Muller, Hawtai is financially very solid and has the advantage of not being a very large company, which is why they could make such a swift decision.
SR cited a report on Hawtai from the Swedish Embassy in Beijing, that raised several concerns. The company has only produced their own cars for a year, and the reported 81,000 cars produced during that year seems exaggerated. The owner of Hawtai, Mr. Zhang Xiugeng from Shandong Province in China, made his fortune through real estate and coal mining in Inner Mongolia, and has become known for being impatient with his CEOs, firing them as soon as they haven’t met his demands, Dagens Nyheter reported.
Chinese and EU authorities still have to approve the deal before it becomes official.
The first step was a 30 million euro (US$43 million) loan from the Gemini Invest fund, which was used to pay off the subcontractors, according to what SAAB Chairman Victor Muller told Swedish Radio (SR). The loan can be converted into stock. A new partner with capital was still needed, however.
From out of nowhere, Chinese car manufacturer Hawtai appeared, and negotiations were carried out at record speed, beginning last Friday, and concluding on Monday.
The deal gives Hawtai 29.9 percent of Spyker, the company that owns SAAB, and access to SAAB’s network of retailers. The price tag: 150 million euros. The partnership will be far-reaching, and Hawtai will also gain access to SAAB’s next generation technical platform. SAAB, in turn, will gain access to the Chinese market.
The Beijing-based Hawtai Motor Group is a new and relatively unknown company, founded in 2000. It has two factories and a production capacity of 350,000 cars a year. Like many other Chinese car manufacturers, the company has been accused of stealing designs from established brands. According to Mr. Muller, Hawtai is financially very solid and has the advantage of not being a very large company, which is why they could make such a swift decision.
SR cited a report on Hawtai from the Swedish Embassy in Beijing, that raised several concerns. The company has only produced their own cars for a year, and the reported 81,000 cars produced during that year seems exaggerated. The owner of Hawtai, Mr. Zhang Xiugeng from Shandong Province in China, made his fortune through real estate and coal mining in Inner Mongolia, and has become known for being impatient with his CEOs, firing them as soon as they haven’t met his demands, Dagens Nyheter reported.
Chinese and EU authorities still have to approve the deal before it becomes official.
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