A Swedish court on Thursday rejected an application by ailing carmaker Saab for protection from creditors to give it breathing space to solve a cash crisis and get funds from Chinese investors. Hit the jump to read the rest of the story.
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The Vanersborg district court in western Sweden said in a statement on its Web site that there was no reason to believe a new creditor protection process, known as a reconstruction, would work. Saab said in a statement that it is disappointed with the ruling and will appeal the decision.
Saab went through the process in 2009-2010 when it was owned by General Motors Co. Saab owner Swedish Automobile NV said it wanted the court’s protection to stop creditors’ payment demands from pushing the carmaker into bankruptcy and allow it to work on securing its future.
The company filed for bankruptcy protection on Wednesday through a voluntary reorganization process which would have involved the court appointing an administrator with whom management would have worked to reorganize the company. Saab had said it would present the reorganization plan to creditors within three weeks of filing the reorganization plan.
