Youngman eyes fresh bid for Saab: sources

STOCKHOLM Wed Jan 18, 2012 10:04am EST

A logo of Swedish car manufacturer Saab is pictured on a car in Vienna, June 24, 2011. REUTERS/Heinz-Peter Bader

A logo of Swedish car manufacturer Saab is pictured on a car in Vienna, June 24, 2011.

Credit: Reuters/Heinz-Peter Bader

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STOCKHOLM (Reuters) - Chinese group Zhejiang Youngman Lotus Automobile could make a fresh bid for failed Swedish carmaker Saab next week, sources with knowledge of the situation said on Wednesday.

Saab was declared bankrupt by a Swedish court in December after protracted rescue efforts by owner Swedish Automobile SWAN.AS.

A key stumbling block was the refusal of former owner General Motors (GM.N) to allow its technology, which underpins Saab cars, to fall into Youngman's hands.

The Chinese group remains interested and is prepared to make an offer, which one of the sources said would be worth several billion Swedish crowns.

A second source with knowledge of the process confirmed that a bid was likely next week.

Neither would say how Youngman would get round GM's objections. The lawyer representing Youngman has said that the firm would seek to develop technology not controlled by GM.

Both sources said there were risks to a bid because receivers were preparing to sell parts of Saab's business to engineering firm Semcon SMC.ST. That would leave little for a buyer interested in continuing to build cars, the sources said.

"The big danger is that Saab and Semcon have agreed a deal with the receiver over large parts of Saab Automobile that would make it impossible for anyone to buy Saab as a whole," the second source said.

Neither the receivers nor Semcon were available for comment.

Last week, Saab's receivers put the Saab car museum up for sale to bring in cash to keep the company ticking over until possible bids for the carmaker could be placed.

Another obstacle is that the receivers have yet to provide information about exactly what assets are for sale, the second source said.

"You don't know if the brand rights are for sale ... if the technology is for sale. There is no information available," the source said.

GM has said it would be difficult to support a sale of Saab that hurts GM's position in China and other key markets.

Without GM's technology licenses and production contract, analysts have said, Saab would be unable to continue in its present form.

Saab's PhoeniX platform, expected to be the base of future models, relies very little on GM technology. But any buyer would have to invest heavily to complete the development of PhoeniX.

Any buyer would also have to get permission from defense and security company Saab AB SABBb.ST and truck maker Scania SCVb.ST to use the Saab name, as they still own the rights to the brand.

(Reporting by Simon Johnson; Editing by David Cowell)

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