Spyker Cars NV, the money-losing Dutch owner of struggling Saab, is in talks to sell and lease back Saab's real estate so it can settle a cash crunch and pay suppliers.
Spyker, which bought Saab from General Motors Co. last year, has said the company is not facing collapse but a short-term liquidity crunch.
Spyker said it is negotiating with a financial institution on the sale and lease back of Saab Automobile's real estate property. "The outcome of the discussions is still uncertain and subject to the approval of the Swedish National Debt Office," Spyker said in a statement on Monday.
The company said it expects "that further announcements will be made shortly."
Spyker did not indicate how much it could raise from a sale and leaseback deal, but in its annual report it said that Saab Automobile's property, Trollhatten assembly plant and equipment was valued at 248.4 million euros ($357.7 million) at the end of 2010.
Production at Saab's factory has been disrupted for the past two weeks because some suppliers have refused to deliver parts, saying they have not been paid. A suppliers' group has said companies are owed tens of millions of crowns.
Spyker has said it is looking at several ways to raise money and ease the cash squeeze. A Swedish business daily reported last week that Spyker was trying to release some of the collateral pledged against state-guaranteed loans to raise funds to meet the unpaid bills.
"Almost all fixed assets of the Saab entities are held by three direct subsidiaries of Saab Automobile," according to Spyker's 2010 annual report.
"The shares in these three subsidiaries are pledged in favor of the Swedish National Debt Office (NDO) as security for the guarantee NDO provided to EIB in relation to the 400 million euro loan from EIB to Saab Automobile."
Spyker is in talks with U.S. and European banks about refinancing and increasing the existing 400 million euro credit facility with the European Investment Bank (EIB).
In the longer term, Saab is hoping for an investment from Russian businessman Vladimir Antonov, a move over which Swedish authorities have the final say. The government is involved because it's guaranteeing Saab's 400 million euro loan from the EIB, the European Union's lending arm.
Spyker bought Saab from GM in February 2010 for $74 million in cash and $326 million in preferred shares.
Saab first suspended production on March 29 after suppliers stopped delivering components. Saab CEO Jan Ake Jonsson said April 4 that the company's liquidity "became more strained" during the second half of the first quarter, declining to give more details.
Saab's sales have plummeted in recent years and the carmaker was on the brink of shutting down during the financial crisis before Spyker bought it. Last year Saab sold 31,696 cars, down from an original forecast of between 50,000 and 60,000 vehicles.
Sales were hurt in 2010 because it took longer than expected to restore the flow of production after GM emptied the factory and cut Saab's supplier ties in January of last year, Spyker CEO and Saab Chairman Victor Muller has said.
Saab, which introduced the new 9-5 sedan last year and in the coming months plans to roll out the 9-4X crossover and 9-5 wagon, aims to sell 120,000 cars and become profitable by 2012. Its best year was in 2006, when it sold 133,000 autos.
Sources: Reuters and Bloomberg News