Saab Automobile may be forced to exit creditor protection because its administrator will apply to end the reorganization against the will of the cash-strapped Swedish carmaker, its parent, Swedish Automobile NV, said.
Saab has been informed that attorney Guy Lofalk will apply with the Vaenersborg District Court in Sweden to terminate the restructuring. The carmaker will contest the decision and ask for a new administrator, Zeewolde Netherlands-based Swedish Automobile said today in a statement.
Saab, which has produced few cars since it first halted production in March because of a lack of money, staved off bankruptcy after a Swedish court on Sept. 21 granted the carmaker’s request for protection from creditors. The court had been scheduled to meet Oct. 31 to decide whether the reorganization can carry on.
For the reorganization to continue, the court must see that Saab has cash to pay for immediate expenses. The Trollhaettan, Sweden-based company said earlier today that it received a $70 million funding pledge from North Street Capital LP, a Greenwich, Connecticut-based private equity firm. Those funds, which consist of a loan and share sale, were aimed at ensuring the continuity of the reorganization.
Swedish Automobile shares fell as much as 21 percent in Amsterdam trading to 0.74 euros, the most since Sept. 9.
Lofalk didn’t immediately return a message left at his Stockholm office.