GM says Saab sale falls through, but still open to offers (2nd Lead)

Dec 18, 2009, 14:38 GMT

New York - US automotive giant General Motors said Friday the efforts to sell ailing Swedish subsidiary to a Dutch company had fallen through, with plans to wind down the company's operations.

The Detroit, Michigan-based GM in making the announcement said however that it was 'still open' to new offers for Saab.

Operations were to be wound down and the Swedish carmaker's 3,400 employees were to be laid off starting from January. It was not immediately clear how long the winding down would take, but the Saab trademark stood to vanish if no buyer were yet found.

'We are still open to new offers,' a GM spokesman said.

GM's disclosure comes only a few days after the US company had indicated the possibility of a deal to sell Saab to the Dutch carmaker Spyker Cars.

In a company statement, GM Europe President Nick Reilly said that 'despite the best efforts of all involved, it has become very clear that the due diligence required to complete this complex transaction could not be executed in a reasonable time.

'In order to maintain operations, Saab needed a quick resolution. We regret that we were not able to complete this transaction with Spyker Cars. We will work closely with the Saab organization to wind down the business in an orderly and responsible manner. This is not a bankruptcy or forced liquidation process,' Reilly added.

'We expect Saab to satisfy debts including supplier payments, and to wind down production and the distribution channel in an orderly manner while looking after our customers.'

On Tuesday, GM chief executive Ed Whitacre had told reporters in Detroit that he had 'a sense it's possible' that a deal with Spyker Cars could be achieved.

The US carmaker had given itself until the end of December to decide on Saab's future.

Last month, a consortium structured around the Koenigsegg Group, a low-volume Swedish sports carmaker, surprisingly withdrew from talks with GM, casting the future of Saab into doubt.

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