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Chinese buyout of Saab on again, off again

words - Joshua Dowling
Hawtai back in the running after Great Wall rumour quashed
It's been a turbulent week for Swedish car maker Saab, which is struggling to survive after it was forced to halt production for the past month because of a cashflow shortfall.

The company has gone to China to try to raise enough cash to stay afloat after being sold by General Motors to small Dutch sportscar maker Spyker last year.

Last week Saab announced it was close to securing a deal with Chinese car maker Hawtai, which was to invest about $USD200 million for a share of the maker.

But the deal fell through at the 11th hour and the next day it was reported that rival Chinese car maker Great Wall was interested in a share of Saab.

But the Great Wall deal too was hit on the head, allegedly by the Chinese government.

However, it has now emerged that the original player, Hawtai, is back in the picture and could resurrect the deal.

According to a report in Britain's Financial Times newspaper, the original Hawtai deal did not fall through because of government intervention, rather it was due to differences in the terms of the agreement

The paper quoted Hawtai vice-president Richard Zhang saying the deal was terminated because of "commercial and economic realities, not lack of government approval". Spyker had earlier said Hawtai was not able to secure "the necessary consents".

"Saab needs help and we strongly believe we are the best partner in this regard," Zhang was quoted in the paper as saying. "We are very focused on coming up with a fair and reasonable structure for a long term relationship."

If the deal goes through it will likely mean that Australia Saab dealers and customers will not notice the interruption to supply of vehicles, given they are sold in relatively small numbers locally.

If the deal falls through and Saab fails to find the necessary backing, the brand may be forced to close or become a boutique car maker.

Regardless of what happens, however, existing Saab customers are protected because Australian law requires the company to make available parts and service for 10 years after a car has been withdrawn from sale.Read the latest Carsales Network news and reviews on your mobile, iPhone or PDA at carsales' mobile site... Powered By Motoring.com.au Published : Monday, 16 May 2011
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