Deal To Sell Saab To Koenigsegg

American car giant General Motors has signed a memorandum of understanding with a new consortium led by Swedish luxury sports car maker Koenigsegg for the purchase of Saab Automobile. GM Europe confirmed the news in a statement on Tuesday morning. It said that the deal will secure Saab's future.

It said the sale, which it expects to be concluded by the end of the third quarter of this year, will include an expected 600 million dollars worth of funding from the European Investment Bank, guaranteed by the Swedish government. Additional funding will be provided by GM and the Koenigsegg Group consortium.

GM Europe President Carl-Peter Forster said: "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," he said.

GM said it would continue to provide technology to Saab during a "defined time period," and added that Saab would produce the next generation of 9-5 models in Trollhättan in southwestern Sweden where the company is based.

Swedish Enterprise Minister Maud Olofsson welcomed the news and said it put an end to months of uncertainty about Saab's future. According to AP, she did however say that the government still needed to see some proof of the consortiums resources.

"We can say that there is strength in the entrepreneurship, but whether there is enough money to be enduring enough is something that is still to be seen," she said.

The head of the IF metal workers' union, Stefan Löfven, said the deal was "clearly a different ownership solution."

"But perhaps that is just what is needed to exploit the hidden values within Saab. We have all along said that we want to see an owner who wants to and who can develop Saab and its operations in Sweden with research and development as well as production," he added.

Saab Chief Executive Jan Ake Jonsson called the deal "great news" and said it would help the brand to maximize it's potential "through an exciting new product lineup with a distinctly Swedish character."

Saab employs about 3,400 people in Sweden, and about 12,000 other jobs in the country are dependent on it through suppliers.

It owes 9.7 billion kronor (1.3 billion dollars, 924 million euros) to GM - its largest individual creditor - as well as 347 million kronor to the Swedish government. Other creditors are owed 647 million kronor.