A property sale and lease-back worth $40 million provides Saab with a second much-needed cash infusion.
Saab has reached a property sale and lease-back deal worth about $39 million that will help provide the struggling brand with a much-needed cash infusion to reopen its assembly line.
Saab will sell 50.1 percent of its property to a consortium of Swedish investors - Hemfosa Fastigheter AB - for $39 million as part of a lease-back deal. Saab won't pay rent for the first year, but the consortium and the automaker will sign a lease agreement for the remaining 14 years.
The investors will have the option to acquire a further $47 million worth of property within 30 days of closing.
Hemfosa Fastigheter AB will have the opportunity to further develop some of the property, something it says it plans to do.
"We are very pleased with the agreement with Saab Automobile," the consortium's CEO, Jens Engwall, said in a statement. "We will continue to add value for Saab Automobile in developing the property."
The deal awaits approval by the European Investment Bank and the Swedish National Debt Office, but since Saab and the consortium had been working out details for quite some time, the automaker expects to receive a go-ahead from regulators soon.
For the Swedish debt office to release the property, Saab would need to agree to see its EIB-provided revolving credit line drop by 120 million euros, which would leave Saab with about 63 million euros (about $90 million) to borrow.
Yesterday, Saab took an order worth about $26.5 million for 582 new cars from an undisclosed Chinese firm. Although the automaker has no cash in hands from its two deals - worth about $66 million combined - it says that its first priority will be to settle unpaid worker wages.