Some Swedes Can't Wait For Saab Going Down The Drain
Sweden’s Dagens Indudstri, the financial paper most hated by the Saab faithful, has dug up another interesting twist in Saab’s concentric circles around the drain: There is one party that is checking daily whether Saab has finally gone belly-up: The consortium of real estate developers that a month ago bought 50.1 percent of Saab’s land, factories and improvements for around $40 million.
This was considered about 30 percent below market. Nevertheless, a lot of people doubted the sanity of the consortium, which is backed by a large Swedish insurance agency. After all, the tenant is Saab, and with its current references, the company would have a hard time renting an apartment in downtown Stockholm. Dagens Industri just found out why the consortium is quite happy with its distressed tenant: If Saab can’t pay the rent, the consortium gets the whole shebang for no extra money.
According to Saab’s press release, Saab signed a 15 year lease on the property. What was not in the press release was what Dagens Industri heard from what DI deems a reliable source. DI was told that the remaining 49.9 percent in the property are pledged as a security for the 15 year lease. First of all, Saab cannot sell off any of its remaining shares. Second, if Saab defaults on the lease, and bankruptcy would be a big case of a default, the rest of the property would go to the consortium to compensate for loss of lease payments, switching costs and sundry annoyances. Again, this is as DI heard it.
In case of a Saab bankruptcy, “the consortium would get all of the property for $ 40 million,” says DI, and explains: “In other words, the price per square meter would be cut in half.”
Dagens Industri tried to confirm that scenario. Saab’s PR department claimed ignorance as far as the lease arrangements are concerned. Jens Engwall, CEO of Hemfosa, did not return DI’s calls. “None of the other leading executives of Hemfosa want to confirm or deny the matter,” writes DI, and sounds pretty sure of itself.
DI recalls what Erik Paulsson, a key figure in the consortium, had said in early July: “If we cannot build cars, we can make car parts etc. … Spare parts alone would be huge.”
The faithful who worry about Saab going under because they won’t get parts for their old Saabs could look forward to this outcome. Parts production would be in the hands of well-financed people.
Latest Car ReviewsRead more
Latest Product ReviewsRead more
- Tassos The EQS is the best looking BEV, better than even the only Tesla I would ever consider (the S) and more luxurious inside etc etcThe self driving features will come in handy when I'm 110 and my eyesight and reaction times start to suffer.But that's four decades away, and only Tim recommends 40 year old "used cars"
- Tassos "Baby, Baby light my fire!""Oh God please give me a Kia Forte" --Janis Joplin
- Tassos The fugly looks of any Subaru, and especially the non-sporty non-elegant, fugly, low-rent looks and interior of the WRX are alone a sufficient turnoff to never want to own one.One can be a 100% car enthusiast but ALSO demand a beautiful AND luxurious vehicle one can be truly proud of and which makes one very happy every time one drives it.The above is obviously totally foreign to Subaru Designers and managers.
- Thehyundaigarage Am I the only one that sees a Peugeot 508?
- Lou_BC I realized it wasn't EV's burning by the absence of the usual suspects.