Swedish carmaker Saab looking to separate from parent GM, files for bankruptcy

20 February 2009

The board of the Swedish carmaker Saab, which is owned by General Motors, has filed for reorganisation, seeking to create a fully independent business. The announcement follows Thursday's extraordinary board meeting in which senior management considered the company's future.

GM has said that it wants to sell Saab. There had been concerns about the loss-making carmaker after the Swedish government rejected GM's call for aid. GM took a 50-per cent stake in Saab in 1989 and gained full ownership 10 years later.

Saab, based in Trollhaettan, filed for reorganisation with a Swedish district court to separate itself from GM and bring resources back to Sweden, Saab CEO and managing director Jan Aake Jonsson said in a statement. The reorganisation, slated to take three months, will place Saab under court supervision, with the aim of creating an independent organization.

''We explored and will continue to explore all available options for funding and/or selling Saab, and it was determined a formal reorganization would be the best way to create a truly independent entity that is ready for investment,'' Jonsson said. Saab also said that the company ''would continue to operate as usual.''

But in the hours after the filing, it was unclear whether the Swedish government would support the company, with government officials seeming to rule out financial assistance as part of what Saab said would be a three-month process of retrenchment.

''Support in the form of money is not on the agenda,'' a spokesman for the industry ministry, Hakan Lind said.