Mike Stevens | Jun 16, 2009

NEWS CAME THROUGH late last month that Swedish supercar company Koenigsegg had been announced as a front-runner in the race to buy Saab from GM. Today, General Motors has announced that the Swedish supercar maker has been successful in its bid.

A letter of intent has now been signed by GM and Koenigsegg, and the financial side of the deal has been agreed upon. All that remains is to sort out the financial structure of the new, Swedish-owned entity.

The deal is expected to be finalised by the end of the third quarter this year, with the European Investment Bank supplying Koenigsegg with a €600 million loan. The Swedish Government will guarantee the loan, and both GM and Koenigsegg will also contribute to keeping Saab afloat.

"The proposed agreement will enable us to maximize the brand’s potential through an exciting new product line-up with a distinctly Swedish character," said Jan Åke Jonsson, Managing Director of Saab.

"Today’s announcement is great news for Saab’s current and future customers, dealers, suppliers and employees around the globe."

Saab sales added up to just over 1 percent of GM's total global sales in 2008. With GM bankrupt and required to divest itself of a number of its brands, Saab has found itself needing $1.2 billion in funding to continue operations and launch new models - chief among them being the all new Saab 9-5.

"This is yet another significant step in the reinvention of GM and its European operations," said GM Europe President, Carl-Peter Forster.

"Saab is a highly respected automotive brand with great potential. Closing this deal represents the best chance for Saab to emerge a stronger company."

General Motors will continue to supply Saab with powertrains and platforms for a "defined period"; Saab has no plans to shift production of its upcoming 9-5 out of Sweden.

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