Going through financial crisis, Swedish Automobile, the Dutch owner of car maker Saab, has finally decided to issue shares to an investment fund. With this, the company hopes to resolve the shortage of monetary funds and pay its employees. Due to a prolonged crisis of liquid funds, the company has been forced to halt its production. Saab has not been able to pay almost half its workforce because of the crisis of funds.
The Dutch parent company has issued a subscription notice for 5 million shares under a 150 million equity facility with GEM Global Yield Fund Limited. Saab Automobile expects to be able to pay the wages of its white-collar workers till this week," the company issued a statement. In the mean time, Swedish Automobile and Saab Automobile continue their discussions with other banks and investing agencies for short term funding.
There has also been some criticism against the Swedish government for being too passive towards Saab Automobile. The Social Democratic MP Jorgen Hellman is going to report regarding the Saab issue to the Committee of Constitutional Affairs. Hellman thinks that the government has not supported Saab during the crisis. The press officer at the Ministry for Enterprise, Energy and Communication, Hakan Lind, however rejects the accusations and adds that he is surprised by the false claims made by the Saab Auto. The wall street journal fears that the Saab Auto may be bankrupt in 14 days.
The Swedish enforcement authority said on Wednesday that the debt for Saab Automobile stands at 5 million Swedish Kronor ($794,000), from three different companies. Last week, the company has said that production is expected to restart by August 29. Moreover, Saab Automobile now has less than three weeks to start clearing the debts; otherwise, the enforcement authority will begin seizing its assets.
