21 Oct 2011

US group to invest in Saab

6:04 am on 21 October 2011

Car-maker Saab has secured a $US70 million investment from a private equity group in the United States.

North Street Capital of Connecticut is paying $US10 million for 2.38 million new shares in Saab's parent company, Swedish Automobile. A further $US60 million is being provided as a loan.

The BBC reports it is the second deal between the two companies in less than a month.

North Street Capital agreed to buy Saab's Spyker luxury sports car business for 32 million euros ($US43.9 million) on 29 September.

Swedish Automobile says it decided to accept the offer because it no longer believes it will receive a promised investment from two Chinese companies.

Swedish Automobile bought Saab from General Motors in January 2010. It had expected that two Chinese firms would buy minority stakes in the company.

However, the BBC reports these deals have not yet obtained regulatory approval in either Sweden or China or from the European Investment Bank.