NEVS starts production of 2014 Saab 9-3Enlarge Photo
Saab’s current owner National Electric Vehicle Sweden is on the verge of bankruptcy but the firm has been thrown a lifeline by a Swedish court. The district court of Vänersborg today approved the application from NEVS seeking additional time to restructure its business, and attorney Lars Eric Gustafsson will serve as administrator.
NEVS, which acquired the remains of Saab in 2012 and briefly restarted production of the 9-3 sedan late last year, recently ran out of cash and has overdue bills with a number of Saab suppliers as well as its own parent company, Hong Kong-based National Modern Energy Holdings. In its restructuring application, NEVS reiterated that it has ongoing negotiations with two “global vehicle manufacturers” and that it needed additional time to “reach an agreement” with the concerned parties.
To raise funds, it’s alleged NEVS will transfer the rights of the still-in-development Phoenix platform and its associated staff and equipment to a new subsidiary. Half of the new subsidiary would then be sold to one of the automakers in talks with NEVS, and the income generated from the sale would be enough to settle any debts.
According to court filings obtained by The Wall Street Journal, NEVS said it posted revenue of 41 million Swedish krona (approximately $5.9 million) in 2013 and losses after financial items of 601 million krona ($86.1 million). NEVS also said it owes its parent company 1.14 billion krona ($163.4 million) and that it has external debt amounting to 400 million krona ($57.3 million).
NEVS has about 400 suppliers of direct materials and 500 suppliers of indirect materials, and says the “vast majority” of these have chosen to await the outcome of the ongoing negotiations. Some creditors have filed applications for an order to pay at a Swedish enforcement authority, however.
NEVS spokesman Mikael Östlund said the firm plans an appeal of the court's rejection. NEVS boss Mattias Bergman also said in a statement that the “firm fully intends” to pay its debts to suppliers.
Stay tuned for an update.