Cut Loose by G.M., Saab Files for Bankruptcy

[Yeo]

Saab, the Swedish maker of road-hugging sports cars and sedans, filed for bankruptcy on Friday as it was cut loose by General Motors as part of the American company's sweeping restructuring plan.

Saab went to a Swedish court for protection from its creditors, and said the company would -- with assistance from the Swedish government -- reorganize to pave the way for private investors to buy all or part of the company, The New York Times reported.

"We explored and will continue to explore all available options for funding and/or selling Saab, and it was determined a formal reorganization would be the best way to create a truly independent entity that is ready for investment," the managing director of Saab, Jan-Ake Jonsson, said in a statement.

Saab also said that the company "would continue to operate as usual."

But in the hours after the filing, it was unclear whether the Swedish government would support the company, with government officials seeming to rule out financial assistance as part of what Saab said would be a three-month process of retrenchment.

"Support in the form of money is not on the agenda," a spokesman for the industry ministry, Hakan Lind said, according to Reuters.

Some analysts questioned whether Saab could survive without a significant lifeline from the government.

"Unless the Swedish government is prepared to put a lot of money into Saab, I think that this is just another step down the road to the graveyard," Bloomberg News quoted Stephen Pope, chief global strategist at Cantor Fitzgerald in London, as saying.

http://www.nytimes.com/2009/02/21/business/worldbusiness/21saab.html?dlbk

http://www.bloomberg.com/apps/news?pid=20601087&sid=auG9TZP6Q3q0&refer=home
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