Saab says Chinese order could pay staff's wages

By MALIN RISING | June 27, 2011 | 5:45 AM EDT

STOCKHOLM (AP) — Troubled car maker Saab Automobile AB has received a euro13 million ($18.4 million) car order from a Chinese company that could help pay salaries to its employees, its owner Swedish Automobile AB said Monday.

The company, previously known as Spyker Cars, claimed the deal would provide the ailing car brand with enough funds to also pay back parts of its debt to suppliers, but didn't reveal the name of the Chinese company.

Last week, Saab said it had run out of cash to pay its 3,700 workers, raising doubts over how long the brand could survive.

Saab spokesman Eric Geers on Monday said the company hopes a prepayment from the Chinese company for the cars will allow it to pay the salaries, which were due last Friday, this week.

Swedish Automobile, which bought Saab from General Motors Co. last year, said it continues to hold talks with several parties to raise more cash for the brand. Among other things, it is in talks to sell and lease back Saab's real estate.

Shares in Swedish Automobile rose by 21.4 percent to euro1.19 ($1.69) on the Amsterdam Stock Exchange.

Separately, Geers said two union members and Saab's General Counsel Kristina Geers have resigned from the board of Saab Automobile, leaving Swedish Automobile CEO Victor Muller as the only board member.

"We very much regret the current cash shortage which is causing undeserved hardship to all and we are working relentlessly to resolve the current situation," Muller said.

Muller said Russian businessman Vladimir Antonov is still interested in investing in Saab, but he has so far failed to receive the necessary approval from the European Investment Bank.

"Antonov can provide much needed financing and/or capital to Swedish Automobile/Saab Automobile at this critical time. We are pushing hard to obtain this vital clearance as soon as practically possible," Muller said.

EIB spokesman Par Isaksson declined to comment on the bank's review of Antonov, saying only that it examines all proposals to change the lending agreement thoroughly.

Antonov has previously said he is prepared to invest between $50 million-$150 million in Saab. He was forced out of Spyker as part of its deal with GM amid reports of money laundering. He has denied those allegations and has never been charged.


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