AMSTERDAM (Reuters) - Spyker SPYKR.AS moved closer on Friday to completing its audacious $400 million buyout of struggling automaker Saab, winning approval for a key loan and shareholder agreement to combine two money-losing enterprises.
The European Investment Bank (EIB) approved a 400 million euro ($547 million) loan to Sweden's Saab, a key condition that needed to be fulfilled before Spyker can buy the maker of the 9-3 and 9-5 automobiles from General Motors GM.UL.
The approval came on the same day as Spyker shareholders met in the Netherlands to approve the deal and were told by Spyker Chief Executive Victor Muller that they combined company will seek to list its shares in London and Stockholm.
“With this acquisition, we have a very rare opportunity to buy into an iconic brand,” said Muller, a former mergers and acquisitions lawyer and fashion brand executive who revived the defunct Spyker brand as a luxury automaker a decade ago.
Asked whether any new listings would make it easier to raise cash from investors, Muller said the goal was “to be closer to investors.”
Despite high hopes, Europe’s public offerings have met with tepid investor interest this year, with deals attracting funding below target or shelved altogether.
Shares in Spyker recovered after news of the EIB loan approval came Friday afternoon, trading 0.5 percent lower at 3.326 euros as of 1520 GMT (10:20 a.m. EST). Earlier, they were down as much as 4 percent.
“He’s (Muller) is going to have to prove what Spyker can do with the business,” said Ian Fletcher, analyst at IHS Global Insight.
Speaking after Friday’s shareholder meeting, Muller told reporters he would first seek a dual listing on the London Stock Exchange and Euronext Amsterdam.
If a subsequent listing in Stockholm happens, the combined company would likely leave the Amsterdam bourse.
GM agreed to sell the struggling 60-year-old Saab brand as it rebuilds its business, and struck a deal with Spyker two weeks ago after intense negotiations and two failed bids.
Spyker is paying GM $74 million in cash and $326 million in redeemable preference shares for Saab, contingent on Saab getting the EIB loan.
Muller has already secured the $50 million needed to close the deal with GM, with the remaining $24 million due in July.
He also vowed that the new group will reach profitability in 2012, although neither Saab or Spyker have made any money in the past decade.
With the loan, Saab’s $200 million in cash and the redeemable shares, Muller said Saab would have enough to fund its business plan, centered on a new 9-5 and two other models.
Saab produced just 20,791 cars last year as sales slumped to 39,903 from 94,751 in 2008, but aims to raise production to pre-crisis levels of about 100,000 to 125,000 with the help of a new sales and distribution strategy.
Spyker started production of its new Aileron model at a plant in Coventry, central England on Tuesday, having switched assembly from Zeewolde in the Netherlands.
(Editing by Greg Mahlich and David Holmes)
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