19 December 2011 Last updated at 12:38 ET

Saab files for bankruptcy in Sweden

Saab CEO Victor Muller: "This is the blackest day of my business career"

Troubled Swedish carmaker Saab has filed for bankruptcy after failing to secure fresh funds from potential Chinese investors.

General Motors (GM), which owns part of Saab, did not want Chinese carmakers accessing technology licences.

Production has been suspended at Saab's main plant in Trollhattan, Sweden, since April as the company has struggled to pay its suppliers.

Workers have complained that they have not been paid since last month.

'Insolvent'

Saab had been in takeover talks with several Chinese companies, including Zhejiang Youngman Lotus Automobile.

The Swedish carmaker said the breakdown of these talks - following the intervention of GM - left it with little option but to file for bankruptcy.

"After having received the recent position of GM on the contemplated transaction with Saab Automobile, Youngman informed Saab Automobile that the funding to complete the reorganisation of Saab could not be concluded," the carmaker said.

"The board subsequently decided that the company, without further funding, will be insolvent, and that filing bankruptcy is in the best interests of its creditors."

• Saab in pictures

Saab Chief Executive Victor Muller described GM's decision to veto the investment from China as "the last nail in the coffin of this beautiful company".

However, he said there was still hope that the company could be saved.

"There are parties out there that have expressed an interest in pursuing a possible acquisition of Saab from bankruptcy," he said.

Last week, the Dutch financial market regulator halted trading in Saab shares.

Earlier this month, a Swedish court told Saab's owners to come up with a credible rescue plan or else enter bankruptcy.

General Motors sold Saab in 2010 to Dutch luxury carmaker Spyker - now renamed Swedish Automobile - but the US automotive giant remains a stakeholder and a supplier.