* Newspaper Dagens Industri: GM could put 3.5 bln SEK into Saab
* Dagens Industri: Saab could file reorganisation Friday
* Board meeting Thu to reconvene at later date - union rep
* Reorganisation is alternative to a bankruptcy filing
* Saab declines comment (Adds newspaper source on restructuring plan)
By Victoria Klesty
STOCKHOLM, Feb 19 (Reuters) - General Motors Corp (GM.N) is prepared to pump in $400 million to help make its Saab car unit profitable if the Swedish state guarantees an even bigger loan to the firm, Swedish daily Dagens Industri said on Thursday, citing unnamed sources.
The newspaper said GM had told unions at a Saab board meeting on Thursday it was prepared to put 3.5 billion Swedish crowns into the firm if the Swedish government guaranteed a 5.2 billion crown loan to Saab.
Part of the money would be used to launch new models and part to cover the loss made by Saab last year. The goal is to help it reach annual sales of 120,000-130,000 vehicles, which would make the firm profitable by 2011 or 2012, Dagens Industri said.
Many analysts believe Saab would need much more money pumped into it to turn it around.
A union representative told Reuters the Saab board met on Thursday and was set to reconvene at an unspecified date. Swedish media reported the meeting was to decide on filing for protection from creditors.
Dagens Industri said a decision on applying for a reorganisation could come on Friday.
A Saab spokeswoman declined to comment.
A reorganisation filing, which is an alternative to an outright bankruptcy filing, would be made with a Swedish court after which the viability of continuing operations is assessed.
GM said earlier this week Saab could file for reorganisation as early as this month and that it still hoped to reach an agreement with Sweden on aid for the brand.
The Swedish government, however, has said its talks with GM over state aid for Saab lacked a realistic basis. Furthermore, it has ruled out owning carmakers or their factories and accused GM of shirking its responsibility as an owner.
Martin Skold, an assistant professor at the Stockholm School of Economics, who analyzes the car industry, said the reorganisation would need to define the legal relationship between Saab and its parent GM.
Cutting legal ties could save GM hundreds of millions of dollars in costs if Saab were to go bankrupt.
In a business reorganisation, a company seeks protection from creditors while it comes up with a plan to become profitable. It is an alternative to bankruptcy, said Sven Save at Ackordscentralen, a Swedish consultancy firm which handles insolvency issues.
A reconstruction could mean measures such as job cuts, a sale of assets or a debt writedown.
Creditors who risk not getting any money at all if the company goes bankrupt, have to be convinced at a first court hearing that lowering their claims is in their best interest.
If no creditors object to the plan at the start of the procedures, they cannot demand a liquidation of the company in a later stage of the reorganisation which can last up to a year.
Joran Hagglund, state secretary at the Swedish Industry Ministry, said he had no information on whether Saab was set to apply for reorganisation and that the government was monitoring developments.
"We continue to analyse the situation and what can happen if there is a reorganisation," Hagglund told Reuters.
GM said in its restructuring plan submitted to the U.S. Treasury on Tuesday that it would cap its financial support for Saab and aimed for the Swedish unit to become an independent business as of Jan. 1, 2010. [ID:nN17397164] (Additional reporting by Anna Ringstrom and Simon Johnson; Writing by Niklas Pollard; Editing by Simon Jessop and David Holmes)