Spyker will need more money to sell more Saabs image

According to Reuters, Spyker will have to raise more cash in order to make its $400-million acquisition of Sweden’s Saab sustainably profitable amid gut-wrenching changes in the global automobile industry.

Spyker Chief Executive Victor Muller clinched an audacious deal last month to buy Saab, helping it avoid closure, but now the Dutch maker of custom-made sports cars will have to double Saab’s production, roll out new models and build a robust distribution network.

That will require hundreds of millions of dollars in new investment, and Spyker, which built only a few dozen cars last year — will have little choice but to tap investors for additional capital, said Tim Urquhart, analyst at IHS Global Insight.

Spyker says there is enough financing — $1 billion — to develop new models and become profitable by 2012, including the new Saab 9-5 based on an Opel platform.

So far, with Saab’s $200 million in the bank, a 400 million euro EIB loan and the preference shares issued to GM — which carry hefty dividend payments of 6 percent from 2012 and 12 percent from 2014 — Saab can keep operations afloat. There is also a 150 million euro credit facility.

But in a sign that Spyker may be prepared to tap new investors for cash, Muller told shareholders last week that he would seek to list Spyker shares in London and Stockholm, and possibly delist from Amsterdam. Asked whether that would make it easier to raise cash, Muller said the goal was “to be closer to investors.”