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Pang Da offers Saab lifeline

0 CommentsPrint E-mail Shanghai Daily, May 17, 2011
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Scrambling for a quick fix for its cash-strapped unit Saab, Spyker Cars NV yesterday signed a distribution deal with a Chinese company Pang Da, but postponed plans to start production in China to avoid regulatory issues.

Netherlands-based Spyker Cars said Pang Da will inject 65 million euros (US$92 million) for a 24 percent stake in Spyker, and the two will form a 50-50 joint venture for the distribution of Saab cars in China.

Spyker has been struggling to find cash for Saab, which was forced to stop production at its plant in Sweden in April. Last week an agreement to start making cars in China with auto maker Hawtai collapsed after the Chinese company said it would not manage to obtain the necessary approvals from authorities in time to save Saab from collapse.

Spyker said the Pang Da deal is also subject to conditions, including clearance by Chinese government agencies, the European Investment Bank, previous Saab owner General Motors Corp and the Swedish National Debt Office.

However, Spyker CEO Victor Muller said it would be easier to obtain the regulatory approvals now because Pang Da is not a car manufacturer.

He said talks with the distributor had begun at the end of last week.

"It was a very busy weekend, you can say. We didn't sleep much, but that has been the case for six weeks," he said during a conference call.

He said Spyker had initially focused on finding a production partner - the "big attraction for going into China" - but realized regulatory nods would take too long.

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