STOCKHOLM (Reuters) -- A Swedish court rejected an application from China's National Electric Vehicle Sweden (NEVS), which bought bankrupt Saab in 2012, for protection against creditors while it concludes funding talks.
NEVS said it had applied to the court for short-term protection from creditors while it concludes funding talks with two major automakers.
The court said the solutions NEVS had outlined to secure funding were "vague and completely undocumented," casting further doubt over the long-term future of the company, which has not built any cars in recent months due to a shortage of money.
"For instance, there is no reasonably exact information about financing needs over time or regarding the timing and size of funds that may be received," the court said in a statement on Thursday.
A NEVS spokesman said the company would appeal the decision.
The company says it is in talks with two unnamed car firms to secure additional money. "The tri-partite negotiations we have with two global vehicle manufacturers are still progressing, but are complex and have taken more time than we predicted," NEVS President Mattias Bergman said in a statement today. "We need additional time to complete the negotiations and reach an agreement."
NEVS last year resumed low-volume production at Saab's Swedish factory but halted production in May saying it lacked enough cash to pay its outstanding debt.
NEVS has about 400 suppliers of direct materials and 500 suppliers of indirect materials. While the vast majority of them have chosen to await the outcome of the negotiations, some creditors have filed for redress with the Swedish Enforcement Authority, the company said.
NEVS decided to file for protection because the Enforcement Authority could force mandatory asset sales, making finalizing new funding more difficult.