15 May 2011

Saab rescue deal off

7:45 am on 15 May 2011

The owners of Saab say a rescue deal with a Chinese company has fallen through.

The Swedish carmaker has been struggling for survival since the global financial crisis. Last year it was abandoned by General Motors and bought by Spyker of Holland.

Spyker had hoped the Hawtai Motor Group would pay 150 million euros ($US221 million) for a 30% stake in the business and relieve its cashflow problems. But Hawtai terminated the deal after it was unable to secure shareholder approval.

Saab says it's still talking with other Chinese firms and there is also interest from Russia.

The BBC reports Spyker's purchase of Saab was helped by a 400 million euro ($US570 million) loan facility from the European Investment Bank.

The company said it was now continuing talks with the EIB to access a further 29 million euros.