Press Release – Swedish Automobile Enters Into EUR 25 Million Convertible Bridge Loan With Gemini Securing Additional Short – Term Funding And Pays Employee's Wages

Trollhättan, Sweden: Swedish Automobile N.V. (SWAN) announces that it entered into a EUR 25 million convertible bridge loan agreement with Gemini Investment Fund Limited (Gemini), thereby securing additional short-term funding.

SWAN entered into a EUR 25 million convertible bridge loan agreement with Gemini with a 6 months maturity. The interest rate of the loan is 10% per annum and the conversion price is EUR 1.38 per share (the volume weighted average price over the past 10 trading days). SWAN may at any time during the loan’s term redeem it without penalty and it intends to do so once the funding from Pang Da and Youngman is received, in which case no dilution as a result of this bridge loan will occur.

Upon receipt of Gemini’s EUR 25 million and upon reaching agreements with its suppliers on payment terms, Saab Automobile hopes to complete its scheduled loan drawdown of EUR 29.1 million from the European Investment Bank (EIB).

As a result of this convertible bridge loan (EUR 25 million), the sale of the real estate (EUR 28 million) and the sale of cars to a Chinese buyer (EUR 13 million), Saab Automobile (conditionally) secured EUR 66 million in additional funding this week. Assuming the receipt of these funds takes place as scheduled, Saab Automobile expects to have secured the liquidity required to restart production hopefully within 2 weeks, subject to reaching agreement with its suppliers which includes feasible delivery schedules.

Victor Muller, CEO of Swedish Automobile and chairman of Saab Automobile said: “I am relieved to report that we made the June salary payments this afternoon from the proceeds of the sale of cars we announced last Monday. We again extend our sincerest apologies to our employees for the hardship the late payment has caused to them. We have clearly gone through a very rough patch in the past few weeks and hopefully we can now reach agreement with our suppliers so as to ensure a resumption of our production in a controlled way. Our mid and long-term funding is secured by the Pang Da /Youngman agreements which are still subject to obtaining certain governmental approvals. Assuming these approvals are obtained, the Gemini bridge loan will be repaid in full.”

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20 Comments

  1. Very impressive!

    I hope the marketing department used the time to work on some strong marketing campaigns, for example stating that a 9-5 drives just as good as a A6, 5 or E, looks way better and is 10% cheaper. Isn’t it fantastic underdog Saab can actually challenge the Germans, which are 10x bigger companies? Independent brand for independent minds.

    1. I really think that this weeks of turbulence is a new opportunity for marketing. Last time (GM sales) I think SAAB lost some of the opportunity to market the h–l out of the fact that SAAB is still around. This is an unintentional opportunity to try once again, or am I totally out with this one?

    2. I totally agree – this is the time for marketing – big time!  When things looked bleak, I told my dealer (Reinertsen, Denville, NJ) that I will go with whatever car they sell – the service is top notch and polite, where do you have that GM?

  2. There is a hope – my hatchback (2002 – 9.3) hit 200,000 miles and my convertible is a 98 (it’s having it’s car mitzvah!) so, I am hoping as hard as I can that this works for Saab, and the 9.3 prototype we are seeing does happen.

  3. We’re still not out of the woods but we’re on the right path.  Vladimir Antonov will hold a press conference in Stokholm tomorrow which should put the pressure on the Swedish government and the EIB to approve his entry into Saab.  Once this happens, the near term future of Saab looks much better.  The only downside to this Gemini loan is that proceeds from the deal with Pang Da and Youngman will be used to repay the loan.  This will take money away from Saab once the deal is approved.

    1. Nope, he will not. According to ttela.se Mr Antonov is engaged in other stuff regarding saab business and will come back with a new time for a media event.

      This gives me a feeling that there will continue be news the coming days

      1. Geez, things change quickly.  Let’s hope that the press conference happens soon and that action is also taken quickly.

  4. Great news!

    Very well done Victor Muller!

    I do hope the production of the amazing cars will restart very soon –
    and the process of developing new cars in the great innovative spirit of
    Saab will continue…

    I am looking forward to see the coming green, efficient, safe,
    well-driving and hopefully beautiful cars from Saab. I am also hoping
    that Saab will have success enough to – in few years – become a healthy
    business. ( The latter seem to be more important to the Swedish
    government then the uniqueness and innovative standard of the company…. )

  5. Nice to hear. However, it can’t be forgotten that this is a loan, not a gift. Let’s hope that it can be repaid on schedule and that production will get going. Otherwise I think it will be hard to save Saab a third time.

    1. Exactly my thoughts. It’s good to have some breathing space, BUT to survive, Saab needs to deliver the cars from the orderbooks.

  6. Wow ! I’d like to think VM could be the manager of the year, with such energy and ingenuity he deployes to pass all these obstacles ! Hope the production lines will restart very soon. Many people all over the world are waiting for their Griffin. Still much work to do !

  7. Darn, Saabsunited seems to go down with every bit of Saab-related news in the headlines. This is worth a read:
    Riksgälden retar upp EIB(Debt Office angers EIB)http://www.svd.se/naringsliv/riksgalden-retar-upp-eib_6283478.svdIt seems Saab is starting to get positive press, and all eyes are looking at the EIB right now.

  8. Well done. 

    Swade – Another question, when will I be able to build and configure the 9-5 sc and 9-4x on the Swedish website? 

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