Swedish sports-car maker Koenigsegg may buy Saab

General Motors has chosen Swedish luxury sports car maker Koenigsegg Automotive AB as the preferred bidder for the Saab brand, news reports said.

Koenigsegg and Norwegian investors have signed a letter of intent to take over Saab, Swedish television said Thursday, attributing its report to unnamed sources. "The deal is there now and a few minor details remain," a source told Reuters.

The reports follow earlier statements from a Saab spokesman saying an announcement on the top finalist could come as soon as this week.

GM, which filed for Chapter 11 protection June 1, put Saab into the equivalent of bankruptcy in February after deciding to cut its 20-year ties with the brand.

The shedding of Saab underscores GM's intensified global effort to jettison non-performing brands and business lines.

Over the last two weeks, the automaker has announced preliminary agreements to sell Hummer to a Chinese suitor and to sell Saturn to Roger Penske's Penske Automotive Group Inc. On Monday, GM said it would terminate its medium-duty truck business after trying to sell it for four years. A deal to sell the unit to Navistar Inc. fell apart.

GM spokesman Chris Preuss declined to comment on the Saab bidding.

Koenigsegg was one of three Saab finalists named in recent published reports.

Bloomberg News, citing one person familiar with the talks, said Koenigsegg was picked because it's an automaker and because it is committed to investing in Saab.

The Financial Times reported on Tuesday that Merbanco, a group of Wyoming investors, is interested in Saab, as is U.S. billionaire Ira Rennert's Renco Group.

The newspaper said GM would provide $500 million in assets and cash, plus production equipment for a new Saab model as well as $150 million of cash already in Saab's account.

Under the deal, the new owner is to pay GM back if it succeeds in turning around Saab, the report said.

Cash amounts pledged by the three bidders vary, but it is smaller than the amount GM is contributing, the paper said.

By Automotive News