* Chinese investors to pump in more than half a bln euros to
* See turnaround in 2014
* To make Saab cars in China as well as Sweden
* Court approves continued reconstruction
By Veronica Ek and Mia Shanley
STOCKHOLM, Oct 31 Chinese groups Pang Da
Automobile Trade Co and Zhejiang Youngman Lotus
Automobile Co will pump more than half a billion euros ($709
million) into Swedish carmaker Saab, aiming to return the
struggling carmaker to profit by 2014.
The plans were outlined in documents submitted to
a Swedish court, which ruled on Monday after a meeting with
creditors that Saab's reconstruction could continue, although
about 15 percent of the 3,400-strong workforce will eventually
have to go.
Pang Da and Youngman, which agreed last week to
buy Saab for 100 million euros from current Dutch owner Swedish
Automobile , have set their sights on sales of up to
55,000 Saab cars for 2012 and have promised a volume of up to
205,000 units per year longer term.
The plans come a year after another Chinese company, Geely,
bought Saab peer Volvo from Ford Motor Co .
Saab sold almost 32,000 cars in 2010 before running into
cash flow problems earlier this year, when production lines
ground to a halt after unpaid suppliers stopped delivering
parts. Saab has not produced cars for months and has been under
court protection from creditors to stop bankruptcy filings.
Under the rescue plan, the Chinese investors will provide a
50 million euro bridge loan and 610 million in long-term
financing from 2012.
"Pang Da and Youngman are not looking for quick returns as a
purely financial investor would be," court-appointed
administrator Guy Lofalk said in a document prepared for the
"Their investment in Saab is driven by a business interest
and a long-term strategy."
UNIONS POSITIVE, JOBS TO GO
At the creditor meeting on Monday, suppliers and unions had
been seeking assurances that bills and salaries would be paid.
"The plan, if it becomes reality, looks really very good,"
Darko Davidovic, a lawyer for Saab's blue-collar union IF
Metall, told Reuters after the creditor meeting approved a
continued reconstruction process.
The plan will come at cost: the new owners aim to reduce
structural costs by 1 billion Swedish crowns ($157 million) and
reduce the headcount by 500 employees. Saab employs about 3,400
people at its ultra-modern plant in Trollhattan, western Sweden.
Davidovic said he expected remaining October salaries would
be paid during the day. Martin Wastfelt, an official at Unionen,
a white-collar union with 1,100 members at Saab, told Reuters
salaries had reached its members.
Suppliers are also owed more than 150 million euros, which
Saab's administrator said the new owners aimed to honour in
Youngman and Pang Da plan to keep production in Sweden, but
also want to build Saab cars in China.
Swedish Automobile said in a statement the long-term margin
and profitability targets were in line with other near-premium
car manufacturers and the plans would help "restore confidence
and trust with all key stakeholders".
Swedish Automobile, then called Spyker, rescued Saab from
closure by former owner General Motors Co in early 2010.
GM still has preference shares in Saab and is a major
supplier of components and so must approve the Pang Da and
Geely's purchase of Volvo, which aims to sell more than
400,000 cars this year, was China's largest overseas auto
Youngman and Pang Da's offer for Saab also still needs the
green light from the European Investment Bank and the Swedish
government, all creditors to Saab.