Dealers trying to push Saab NA into bankruptcy

Jonathon Ramsey — Tue, 31 Jan 2012 14:31:00 EST

Filed under: Government/Legal, Saab, Earnings/Financials

Saab North America acknowledged that the chances were exceptionally slim, but it hoped to avoid bankruptcy long enough to give another company a chance to buy it. Shortly after Saab NA appointed a third-party administrator, McTevia & Associates, it was decided there was no way to save the company short of liquidation, and on January 23, the administrator announced plans to file for Chapter 7 bankruptcy.

But Saab NA was beat to the filing by a group of 162 out of the 188 Saab dealers, who filed for involuntary Chapter 11 bankruptcy in Delaware. The dealers said last week they were going to file for Chapter 7, but instead chose Chapter 11 because of its lower costs and in case China's Youngman or Turkey's Brightwell Holding's bid for Saab NA's parent succeeds and they want to restart operations here. The document was filed in Delaware because the dealer body feels they'll get better hearing "further away from Detroit." Dealers also wanted the force of court orders to back up any decisions made, not that of a third-party administrator.

Underneath all the legal machinations, though, if estimates from Saab NA dealer attorney Leonard Bellavia are accurate, then the parties could emerge without getting financially kneecapped. When McTevia announced its plan to file, Bellavia suggested that Saab NA's liabilities were $10.5 million and assets at between $75 million and $125 million. With no more parts on the way and 2,400 cars on lots, McTevia had earlier said that the parts distribution business is "the only meaningful asset."

Dealers trying to push Saab NA into bankruptcy originally appeared on Autoblog on Tue, 31 Jan 2012 14:31:00 EST. Please see our terms for use of feeds.

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Saab North America hires administrator but won't file bankruptcy

Chris Shunk — Fri, 23 Dec 2011 09:03:00 EST

Filed under: Government/Legal, Saab

Saab has filed for bankruptcy in Sweden, which is likely to be a death knell for the storied automaker. But just because headquarters has filed doesn't mean that Saab North America will follow suit.

The Detroit News reports that Saab has hired Michigan firm McTevia & Associates to deal with creditors, and that there are no immediate plans to file for bankruptcy. Saab president Tim Colbeck reportedly acknowledged to DetNews that the company doesn't have much hope of staying out of liquidation, but added the best chance for survival is a company purchasing Saab out of bankruptcy. On the flip side, even though Saab NA feels that it is cheaper and easier to stay out of bankruptcy court, Colbeck adds that creditors could eventually force the company into bankruptcy.

McTevia chief Jim McTevia tells The Detroit News that the hope is that Saab NA will continue operating long enough for another company to come in and purchase Saab. Saab NA has 188 dealers, and there are 2,400 vehicles still sitting on dealer lots. Saab also employs about 50 employees in Royal Oak, MI.

Saab North America hires administrator but won't file bankruptcy originally appeared on Autoblog on Fri, 23 Dec 2011 09:03:00 EST. Please see our terms for use of feeds.

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