GM is to wind-down Saab's operations as talks with Dutch sports-car maker Spyker collapsed.

Swedish auto brand Saab Automobile will be shut down after its owner General Motors failed to find a buyer for the money-losing unit, affecting up to 8,000 workers in Sweden.

The intended sale of Saab will not be concluded as GM's discussions with Dutch sports-car maker Spyker fell through, GM said in a statement Friday.

"Despite the best efforts of all involved, it has become very clear that the due diligence required to complete this complex transaction could not be executed in a reasonable time," GM Europe president Nick Reilly said.

During the due diligence, certain issues arose that both parties believe could not be resolved. As a result, GM will start an orderly wind-down of Saab operations.

"We will work closely with the Saab organization to wind down the business in an orderly and responsible manner. This is not a bankruptcy or forced liquidation process. Consequently, we expect Saab to satisfy debts including supplier payments, and to wind down production and the distribution channel in an orderly manner while looking after our customers”, Nick Reilly said.

Up to an estimated 8,000 people in southwest Sweden, including 3,400 Saab employees, consultants and sub-contractors, will be affected by the close-down, according to a study by Swedish Agency for Economic and Regional Growth. It could also pose a problem for Sweden's other carmaker Volvo, owned by US-based Ford Motor Co.

“This is very sad”, Maud Olofsson, Sweden’s Minister of Enterprise, told the TT news wire. “Very sad news for all of the employees and it comes at the worst possible time”.

Also Saab Chief Executive Jan-Åke Jonsson expressed his disappointment that the deal with Spyker couldn't be completed.

"We're surprised and a bit disappointed at the decision," he told Dow Jones Newswire, adding that it was too early to say what will happen next.

Last week GM said that Dutch sports-car manufacturer Spyker was the only remaining bidder for the remaining assets of its Saab unit after Swedish luxury carmaker Koenigsegg and its partner, China's state-run Beijing Auto, gave up a bid due to costly delays.

Spyker is being backed by its biggest investor, Russian banking group Convers Group. The deal also depended on Sweden's guarantee and European Union's approval for a 400 million-euro ($600 million) loan from the European Investment Bank.

However, Spyker’s bid has been slammed by several analysts who believe the Dutch company doesn't have the financial muscles or knowledge needed. A Dutch journalist suggested Thursday that Spyker is only interested in the 400 million euro EIB loan —not in Saab’s future.

“We sincerely regret that we are not able to complete this transaction with GM. We worked 24/7 for three weeks, but the complexity of the transaction in combination with the strict deadline simply did not allow us to complete the transaction timely”, Spyker’s chief executive officer Victor Muller said in a statement.

“Our thoughts are with the wonderful management and employees of Saab in these challenging times", he continued.

Converse Group holds 30 percent of the capital of Spyker, which is listed on the Amsterdam stock exchange. Converse Group is controlled by Russian banker Alexander Antonov. The stock plunged more than 13 percent on the Amsterdam exchange after the news.

Earlier this week, GM agreed to sell some Saab assets to China's Beijing Automotive Industry Holding Co. State-owned BAIC will acquire the technology for Saab's 9-3 and 9-5 car models, turbine engines and gearboxes, allowing the Chinese firm to develop its own-brand cars using the Swedish carmaker's technology.

GM said it would continue to honor warranties and provide parts to Saab owners around the world. Saab sold just over 93,000 cars worldwide in 2008.

Under GM's stewardship spanning almost two decades, Saab rarely posted a profit and last year lost 3.0 billion kronor (241 million euros, 341 million dollars at the time). It last made a profit in 2001, the only year it was in the black in almost two decades of GM ownership.