Sport car maker Koenigsegg set to purchase Saab (News Feature)

By Lennart Simonsson Jun 12, 2009, 12:02 GMT

Stockholm - A small sport vehicle maker has taken analysts and motor writers by surprise as it reportedly remained in the driving seat to take over troubled Swedish carmaker Saab Automobile.

Koenigsegg, backed by a consortium of Norwegian investors, was Thursday named as the new owner by Swedish broadcaster SVT. However, Saab, its current US owner General Motors, the Swedish government and Koenigsegg have yet to confirm the report.

The combination of Koenigsegg and Saab was unexpected. SVT financial commentator Rolf Tardell noted that Saab is 20 times larger than Koeniggsegg.

Saab's plant at Trollhattan in south-western Sweden makes some 100,000 vehicles a year compared - to the just 15 or 20 custom-built cars Koenigssegg builds in Angelholm, southern Sweden.

'This makes me doubt the deal. I cannot see this as securing jobs at Trollhattan in the long-term,' Tardell said on SVT.

Svenska Dagbladet columnist Jonas Froberg said that 'it sounds crazy - and likely it is' but added that cash-strapped Saab needs money to survive and the consortium could prove a lifeline.

Koenigsegg has some 40 employees while Saab has some 3,500 after recent job cuts.

Koeniggsegg was founded in 1994 by Christian von Koenigsegg, 37, who as a young boy dreamed of making cars and saw the dream fulfilled in 2002 when the first car was sold.

The deal is reportedly backed by among others Norwegian designer and entrepreneur Bard Eker, the largest stakeholder in Koenigsegg.

Eker and his Eker Group have also not commented the reports of a tie-in with Saab.

Eker can be compared to British businessman Sir Richard Branson, von Koneigsegg told the financial daily Dagens Industri.

No terms of a potential takeover of Saab have been disclosed, and even if a letter of intent is signed it may take several weeks to hammer out details.

More details may surface next week when a Swedish court appointed administrator, lawyer Guy Lofalk, is due to meet with Saab creditors about writedowns.

GM alone accounts for some 90 per cent of Saab's 10.5 billion kronor (1.35 billion dollars) debt.

Swedish State Secretary Joran Hagglund stated on Thursday that the government had instructed the National Debt Office to prepare talks with Saab Automobile and a new possible owner over state loan guarantees.

GM has stated its intention to shed the Swedish brand, which has, since February, been under bankruptcy protection as it attempts to reorganize its business.

The National Debt Office was to be 'on standby' in order to enable the process, should state loan guarantees be needed, Hagglund added.

The government has, to date, held off on offering state loan guarantees to Saab, saying it needs to get a clear picture of Saab's new owner before putting taxpayer's money at risk.

Saab's bankruptcy protection was recently extended to August 20.

GM's interest in Saab - one of Europe's smallest carmakers - dates back to the early 1990s. The company took full control in 2000.