• Marketwatch, Financial TImes, Friday, February 20, 2009 11:15 AM

The Saab Automobile division of General Motors filed for creditor protection this morning after both the Swedish government and GM refuse its request for additional funding, Steve Goldstein reports. "Pending court approval, the reorganization will be executed over a three-month period and will require independent funding to succeed," it said. It will continue to operate as usual in the meantime.

Saab's plight has put Sweden's center-right government in a tight spot, write John Reed and Robert Anderson in the Financial Times. Saab employs 4,100 people in Sweden, and an estimated 15,000 domestic jobs would be at risk if the company closed. But the government has consistently refused to inject state money into Saab.

The government is accusing GM of failing to make the investments in Saab needed to create attractive models and maintain its technological edge. It has also criticized GM for threatening to cut the nameplate adrift and pass on shutdown costs. Any buyer would need to conclude long-term licensing and supply agreements with GM for components such as engines, further complicating a sale.

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