Saab denied bankruptcy protection

Saab's Trollhattan plant in Sweden has shut down and the company has been unable to pay its 3700 workers for the past two months.

The former General Motors brand was closer to financial oblivion after it was denied bankruptcy protection.

A Swedish court overnight dismissed a bankruptcy protection petition filed by a company that has teetered on the brink of oblivion for more than a year after being sold to GM, with a failed bid for support from the supercar manufacturer and new owner. Spiker.

Saab's owner, Swedish Automobile - formerly Spyker Cars - has filed for voluntary bankruptcy protection in Vanesborg District Court, Sweden.

The app was intended to protect Saab from creditors by giving it time to secure additional funding, launch a reorganization plan and restart production, while still being able to pay wages.

The Saab Trollhattan plant in Sweden has shut down, and the failure to pay 3700 workers in the past two months has led to unions threatening bankruptcy.

The company is seeking three months of legal relief from its creditors while it awaits Chinese regulatory approval for its A$325 million joint venture deal with Pang Da Automobile and Zhejiang Youngman Lotus Automobile.

Bankruptcy protection and any court ruling does not apply to Saab Australia, whose managing director Stephen Nicholls says yesterday's news came as a nasty surprise.

“Obviously the news is not what we were hoping to wake up to,” says Nicholls. “We hoped that the court would satisfy this. But obviously we are going to appeal this decision and it will take about a week to go through the process and file an appeal.

Nicholls says he doesn't have details on why the application was denied, but an appeal would be a stronger argument.

“I have not seen the verdict itself and am not authorized to comment on the details of the verdict. But we think there must have been some flaws in the performance as we think the case itself is in order,” he says. “We just need to fill in these gaps and provide additional information if required, and we are confident that this will be successful. The burden of proof is simply to demonstrate that we have the means, and we're going to go back to the drawing board and overload them with information this time."

Nicholls says Saab's operations in Australia will not be affected by the ruling. “Saab Cars Australia was clearly excluded from the bid – as was the US and so on. But ultimately our destiny is tied to the parent company, and we continue to trade, still respecting the guarantees and supplying spare parts.

“We finance, we trade, but for now we carry on and wait for news from the frozen north.”