* Court rejects application for protection from creditors
* Court says not convinced process would work for Saab
* Company sought protection to secure Chinese investment
* Union mulls bankruptcy request
* Saab to appeal decision
(Adds quotes from head of union, local resident; changes
dateline from STOCKHOLM)
By Johan Ahlander
TROLLHATTAN, Sweden, Sept 8 Saab said it was
"not dead yet" after a Swedish court pushed the ailing carmaker
closer to collapse by rejecting its application for protection
The court decision could open the way for Saab itself,
unions or creditors to seek bankruptcy for a company where a
chronic shortage of cash has halted production and left
suppliers and workers unpaid.
Saab, which brought the application to win time for vital
Chinese investment, said it would appeal the ruling and provide
more information on Friday.
"We are not dead yet. We were not dead yesterday, we are
definitely not dead today," news agency TT quoted Victor
Muller, chief executive of Saab's owner, Swedish Automobile
SWAN.AS, as saying.
Muller told Reuters the court had rejected the application
because it wanted more information about "the process for
Chinese investors and the timing of funds."
He said Saab would submit those details as soon as
possible. If the appeal is rejected "it would be a major
setback," he said. "But we still have many ways of skinning the
He declined to say what other financing options were being
People on the streets of the western Swedish town of
Trollhattan, where Saab is based and which relies heavily on
the company as a key local employer, were concerned.
"It's a very sad day for Trollhattan," said Johan Hansson,
a construction worker, on a nearly deserted street in downtown
"I feel for the families, especially the ones where both
parents work at Saab. There's quite a few of them," he added.
The court set a deadline of Sept. 29 for an appeal. A court
spokeswoman said that while Saab had no court protection,
petitions for bankruptcy could be made.
The Vanersborg district court in western Sweden said it was
"unclear how the company would be able to solve its liquidity
crisis and continue operations."
Trading in Swedish Automobile's Amsterdam-listed shares has
been suspended. Regulator AFM said the shares would remain
suspended. It will decide after the company's statement on
Friday whether to allow trading to resume.
The IF Metall union said it was considering its course of
action. Unions have said they could seek Saab's bankruptcy to
activate a state scheme to pay wages, even though that decision
would mean the end of Saab.
"We have to look after our members' interests. If that
means taking such a harsh decision, then so be it," IF Metall
head Stefan Lofven told reporters as he was entering a meeting
with the local union chapter in Trollhattan. But he added that
he still held out some hope Saab could avoid bankruptcy.
"Yes, otherwise we would have taken a decision already. But
since we believe there still is a chance, we're here," he
Saab town caught between hope and despair [ID:nL5E7K524J]
Saab's bankruptcy protection application [ID:nL5E7K7204]
Saab CEO, eternal optimist, seeks a saviour[ID:nLDE7860M4]
Saab was scheduled for closure by owner General Motors Co
(GM.N) in 2010 but was rescued by Amsterdam-listed Spyker Cars,
which later changed its name to Swedish Automobile.
Trollhattan mayor Paul Akerlund said he still hoped for the
best. "Of course, this is not a good thing. One hopes that in
some way they can find a solution in the end. I'm not giving
up," he told Reuters by telephone.
Swedish Automobile sought protection from creditors to stop
them pushing Saab into bankruptcy and give it time to secure
investment from Chinese car companies Pangda Automobile Trade
Co Ltd (601258.SS) and Zhejiang Youngman Lotus Automobile.
The Chinese companies have agreed to take a combined
majority stake in the firm for a total of 245 million euros
($344 million), but the investments need official Chinese
The court said it was not clear if this would be
forthcoming and that Saab had only provided very general
information about negotiations for other financing options.
The court said there was no reason to believe a new
creditor protection process, known as a reconstruction, would
work. Saab, when it was owned by GM, went through a
reconstruction in 2009-2010.
Chinese authorities in the past have halted planned
investments by Chinese companies, including Saab's own failed
deal with Hawtai Motor Group in May and Sichuan Tengzhong Heavy
Industrial machinery's bid for GM's Hummer, which collapsed in
2010. [ID:nLDE5BS12U] [ID:nTOE706015]
($1 = 0.712 Euros)
(Reporting by Johan Ahlander; Additional reporting by Roberta
Cowan, Mia Shanley, Anna Ringstrom, Sara Webb and Patrick
Lannin; Editing by David Cowell, Elaine Hardcastle and John