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  • Swedish Automobile issues 5 million shares for raising cash to pay Saab employees

    Press release from Saab today:

    Trollhättan, Sweden: Swedish Automobile N.V. (Swan) announces today that it issued a subscription notice for 5 million shares under the current EUR 150 million equity facility between Swan and GEM Global Yield Fund Limited. The exact number of shares to be issued and the price thereof will depend on a 10 day pricing period, which commences today.

    Saab Automobile AB (Saab Automobile) expects to be able to pay the wages of its white-collar workers still this week. Swan and Saab Automobile continue their discussions with parties to obtain further short-term funding to be able to restart and sustain production.
    From Automotive News:

    The new share issue, announced on Wednesday, is unlikely to buy Saab much time: based on the current share price, it would raise just under 7 million euros.

    "Let's assume they get around 6.5 million euros from this sale looking at where the share price is. They need at least 50 million euros to pay suppliers and get things started again. They have much more to do," said Tom Muller, an analyst at Theodoor Gilissen.

    Swedish Automobile said GEM Global Yield Fund Ltd. will acquire about 5 million new shares in the Amsterdam-listed company, giving it a 17 percent stake.

    Read more: http://www.autonews.com/apps/pbcs.dl...#ixzz1TyEktjLo
    From the Wall Street Journal:

    "We believe we'll be able to pay the wages this week, but before we have the money on our account we're a bit careful," said Saab Automobile spokeswoman Gunilla Gustavs. Saab Automobile last week had to delay paying wages to its 1,600 white-collar employees as, according to the company, some of the funds that have been committed by investors weren't received in time to meet salary payments.

    In order to pay the wages and avoid bankruptcy, Swedish Automobile issued a subscription notice for five million shares under an existing EUR150 million credit facility between Swedish Automobile and GEM Global Yield Fund Ltd. According to this facility, Swedish Automobile can issue shares to GEM at 90% of the average of the closing bid prices of the shares over a period of 15 days.

    The facility was last used May 16 when Swedish Automobile issues a million shares to GEM, generating approximately EUR3 million, based on the average share price between May 16 and June 3. Based on Swedish Automobile's current share price, the five million new shares would generate proceeds of about EUR6.5 million. The Swedish labour union, Unionen, which represents 1,000 of Saab Automobile's white-collar workers, said the car maker owed its members 35 million Swedish kronor (EUR3.8 million) in unpaid salaries.

    The wages had been due to be paid July 27 but when payments weren't made the union began gathering members' pay slips that hadn't been honored. Unionen plans to send payment requests to Saab Automobile Wednesday or Thursday. When Saab Automobile receives the requests, it will have seven days to pay the claims. If the wages aren't paid, Unionen will have three weeks to file for a Saab Automobile bankruptcy. "We hope this works out, but we continue our work until the money has been paid out," said Johan Ulvenlov, press secretary at Unionen.

    Read more: http://online.wsj.com/article/BT-CO-...03-701562.html
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