Following on from last week’s collapsed Hawtai Motor Group deal, Saab owners Spyker Cars have announced a fresh collaboration agreement today with Pang Da Automobile Trade Co, a Chinese vehicle distributor.
Saab and Panda Automobile Company? Sounds Mickey Mouse to me!
Pang Da, not Panda. The firm is based in Tangshan, and sells a number of foreign and domestic vehicle brands through its nationwide dealer network. Among international brands distributed by Pang Da are Mercedes-Benz, Toyota, Subaru, Mazda and Honda.
Pang Da lists over 1100 sales, servicing and distribution outlets in China and Mongolia, including 926 sales outlets opened at the end of 2010. The company launched its initial public offering of shares on the Shanghai stock exchange last month.
Spyker and Pang Da: the deal in detail
The deal includes distribution and manufacturing in China, with Pang Da making an immediate investment of €30m (£26m) for the purchase of Saab vehicles to sell in China. The deal also includes a possible further purchase of €15m (£13m) of vehicles within 30 days.
Pang Da will take a 24% equity stake in Spyker Cars, purchasing €65m (£57m) of Spyker shares at €4.19 (£3.66) per share. Pang Da will gain the right to nominate a member or the Spyker and/or Saab supervisory board as part of the investment.
An agreement in principle has also been made on the establishment of a 50:50 joint venture manufacturing company in China. The joint venture will produce both Saab and a joint-venture created domestic brand for the Chinese market. As Pang Da is not a manufacturer, an additional partner will be sought by Pang Da to participate in their side of the joint venture.
Is this latest deal going to work?
That would be the €30m question. Unsurprisingly, the latest investment deal still has to go through some regulatory approvals in China, and with Saab’s stakeholders (the Sweditsh National Debt Office, European Investment Bank and General Motors).
But the initial £26m investment is for the purchase of cars, and Saab hopes that this will provide it with the funds to settle its impasse with component suppliers and restart production at Trollhattan – where the factory line has lain dormant for weeks. The share purchase and joint venture agreement will be implemented later as approvals are received.
Here’s hoping Saab’s factory can start building cars again sooner rather than later…
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1 March 2011 – Saab Phoenix concept (2011) at Geneva motor show
5 April 2011 – Latest Saab production halt raises concern
11 April 2011 – Saab’s latest factory shutdowns ‘just a blip’
16 May 2011 – Saab announces new China Joint-venture
16 June 2011 – Saab 9-5 Sportwagon (2011) prices and revised 9-5 range
24 June 2011 – Saab unable to pay wages as financing crisis deepens
27 June 2011 – Saab secures more funds as it seeks to avert collapse
28 October 2011 – Saab is sold again: two Chinese makers buy Saab
1 November – Saab 9-3: is this the new 2013 hatch