Saab’s application for bankruptcy protection has been approved by the Court of Appeal in Gothenburg. This will give Saab more time to pay its workers, and its suppliers once investment funds finally come through.
A few of weeks ago, Saab applied for bankruptcy protection after two unions asked courts to put Saab into bankruptcy after the Swedish company failed to pay a number of its workers. Saab was given time to pay but the company couldn’t come up with the funds by the deadline.
Two weeks ago, courts rejected Saab’s application for bankruptcy protection saying that it didn’t believe a reorganisation would work for Saab. Saab was waiting on promised investments from Chinese companies Pang Da and Youngman at the time (and still is), which didn’t help the situation.
The purpose of the bankruptcy protection will give Saab more time to “secure short-term stability while simultaneously attracting additional funding, pending the inflow of the equity contributions by Pang Da and Youngman”, according to a recent statement.
Saab is now waiting for approval of the 245-million-euro ($331 million) investment to finally be approved by Chinese authorities. Once that happens it can begin reorganisation.