Official: Koenigsegg to buy Saab
General Motors confirmed this morning that it has signed a memorandum of understanding with a consortium representing Swedish supercar manufacturer Koenigsegg over the purchase of the beleaguered Saab unit. The announcement that Saab will once again be a fully Swedish automaker confirms numerous reports over the last week that Koenigsegg was the favored bidder.
"The proposed agreement will enable us to maximize the brand's potential through an exciting new product line-up with a distinctly Swedish character. Today's announcement is great news for Saab's current and future customers, dealers, suppliers and employees around the globe," said Jan Ã...ke Jonsson, Managing Director of Saab Automobile AB, in a statement released jointly by GM and Koenigsegg.
Under the terms of the memo, GM will continue to provide architecture and powertrain technology for a "defined time period," meaning that the automaker's 9-3, next-generation 9-5 and upcoming 9-4x, which were all designed using existing GM technology, will be part of the automaker's portfolio as planned.
A news release by GM further confirmed that the next-generation 9-5 will be built in Saab's TrollhÃ¤ttan, Sweden, assembly plant. It is assumed that Koenigsegg will take ownership of that historic auto plant.
"This is yet another significant step in the reinvention of GM and its European operations," said GM Europe President, Carl-Peter Forster, in a statement. "Saab is a highly respected automotive brand with great potential. Closing this deal represents the best chance for Saab to emerge a stronger company. Koenigsegg Group's unique combination of innovation, entrepreneurial spirit and financial strength, combined with Koenigsegg's proven ability to create world-class Swedish performance cars in a highly efficient manner, made it the right choice for Saab as well as for General Motors."
GM expects the sale to close in the third quarter of this year and it is anticipated that it will include a $600 million commitment of funding from the European Investment Bank. An undisclosed sum will be invested in Saab's future by GM and the price of the sale has yet to be announced.
Given that the deal includes a factory and two unreleased new models, it is certainly the biggest outright sale GM has made since filing for bankruptcy.
It took just over two weeks from GM's Chapter 11 bankruptcy filing in New York for it to sell off the fourth, and final, unit it was looking to unload. The automaker has already announced its intentions to sell Saturn to Penske Automotive Group, Hummer to Sichuan Tengzhong Heavy Industrial Machinery and the majority of Opel to groups aligned with Magna International.
Some analysts have expressed concern over the deal, which Forbes says is between two "unlikely bedfellows." With around 50 full-time employees, Koenigsegg is hardly a major player in the industry that Fiat CEO Sergio Marchionne says needs to be consolidated post haste.
"I'm struggling to see the point of this deal," said Philippe Houchois, head of European auto industry research at UBS in London told the New York Times. "Is it to ensure the survival of Saab, to save jobs? It looks like a short-term solution that doesn't resolve the core issues."
Still, the deal saves about 5,000 jobs worldwide.