GREAT NEWS - SAAB is BACK, new Owner agrees to buy majority stake and subsidise current finances.

India's Mahindra & Mahindra has agreed to buy a majority stake in National Electric Vehicle Sweden (NEVS), the investment group that bought the assets of Saab Automobile two years ago, a report said.

NEVS' administrator, Lars Eric Gustafsson, said today in a statement that an Asian carmaker has agreed to purchase a majority stake in NEVS. Neither Gustafsson nor NEVS identified the company.

The website SaabsUnited said NEVS and Mahindra have signed an agreement for Mahindra to step in as majority owner of NEVS. The agreement is being kept secret until it is finalized the website said.

Gustafsson's statement said the Asian carmaker agreed on Nov. 30 to the deal and to finance the company’s operating costs until the agreement is complete early next year.

Gustafsson also said that NEVS is in talks with another Asian manufacturer on a joint venture to develop new vehicles.

NEVS, a Chinese-Japanese investment group led by renewable energy power-plant builder National Modern Energy Holdings, sought protection from its creditors in August after struggling to deliver on a target to produce 120,000 cars a year by 2016. That would have come close to the Saab brand’s 2006 peak annual ouput of 133,000 vehicles.

The potential majority shareholder has offered to provide bridge financing of 5 million euros ($6.2 million) a month to cover operating costs until the agreement is complete, NEVS said. Pending due diligence, the company said the deal should be finished by February.

NEVS was granted permission by a Swedish court on Aug. 29 to carry out a reorganization of the company. It applied today to Vaenersborg District Court to extend the reconstruction period by three months.

NEVS said it had trouble paying its creditors after its shareholder, Qingbo Investment Co., didn’t fulfill a promised investment of 1.15 billion kronor ($155 million).

Saab was previously owned by General Motors Co., which acquired full control in 2000, before selling it in 2010 to Dutch supercar maker Spyker NV, which failed to revive the brand. The auto business split from Saab AB’s aerospace operations in 1990.

Gustafsson's statement said the majority owner will negotiate with Saab AB to use the Saab brand name and badge. Saab AB withdrew permission after NEVS applied for creditor protection. NEVS expects to be able to renegotiate the Saab brand agreement following a solution to its funding troubles.

Swedish newspaper Svenska Dagbladet reported on Aug. 5 that NEVS was in talks with Mahindra & Mahindra and China’s Dongfeng Motor on funding, citing unidentified people with knowledge of the talks.

SAAB weather new bankruptcy with news that a two major manufacturers are in talks for assistance.

Saab's owner, National Electric Vehicle Sweden (NEVS), says it is in discussions with potential partners as it seeks to restart car production and develop future models.

NEVS was forced to stop production at Saab's factory in Sweden in May due to a shortage of cash to pay suppliers. NEVS last week denied that Saab is facing insolvency after a supplier filed a bankruptcy petition.

"We need cooperation to secure a long-term financial structure and help us to solve our short-term financial challenges," a NEVS spokesman told Automotive News Europe.

The spokesman said NEVS is talking with potential investors but declined to name them. Getting new investment is a "prerequisite to forming a decision on how and when we can resume production," he said.

NEVS said Labo Test, one of Saab's suppliers, had petitioned a Swedish court to declare the automaker bankrupt over unpaid bills of 150,000 kronor (16,372 euros). According to NEVS, the petition has now been withdrawn.

"The company does not have enough liquid cash today to pay all outstanding debt, but NEVS' assets are larger than its debt. NEVS cannot say exactly when, but NEVS' suppliers will get paid," the company said in a statement.

The automaker’s debts amount to 3.6 million kronor (393,000 euros) with the Swedish Enforcement Authority, the Wall Street Journal reported Aug. 13, adding that the government agency has said another 91 claims, many of which are for several million kronor each, are waiting in the pipeline for NEVS to acknowledge.

China revival

NEVS, which is controlled by National Modern Energy Holdings Ltd., whose founder and principal owner is Chinese-Swedish businessman Kai Johan Jiang, bought Saab from Dutch niche sports-car maker Spyker in September 2012 with the aim of reviving the brand with an electric lineup aimed chiefly at the Chinese market.

Production of a gasoline-powered 9-3 model began a year later, but by May the company ran into financial difficulties and halted production, which stood at six cars a day.

Spyker bought Saab from General Motors in early 2010, but soon hit financing problems and spent months trying to put together deals with Chinese companies before Saab filed for bankruptcy in December 2011.