General Motors has signed a memorandum of understanding to sell Saab to sports car maker Koenigsegg Group.

Swedish sports car maker Koenigsegg Group will become the new owner of General Motor’s Saab, which is under protection from creditors, GM wrote in a statement on Tuesday.

The sale, expected to close by the end of the third quarter of this year, includes an expected $600 million funding commitment from the European Investment Bank (EIB) guaranteed by the Swedish government.

"Closing this deal represents the best chance for Saab to emerge a stronger company", said GM Europe President, Carl-Peter Forster. "Koenigsegg Group's unique combination of innovation, entrepreneurial spirit and financial strength, combined with Koenigsegg's proven ability to create world-class Swedish performance cars in a highly efficient manner, made it the right choice for Saab as well as for General Motors."

Additional support is to be provided by GM and Koenigsegg to fund Saab's operations and product program investments. This includes plans to launch several new products that are in the final stages of development. Saab plans to produce its next generation 9-5 models in the Saab production facility in Trollhättan, south-west Sweden.

The union IF Metall, representing many Saab workers, is happy that the deal finally is closed and the long-drawn bidding process is over.

“This is clearly an unusual solution and maybe that is exactly what's needed to realize the hidden values within Saab”, said Stefan Löfven, head of IF Metall.

“We are looking forward to meet the new owner to see what long-term plans and financial strength there are”.

Jan Åke Jonsson, Managing Director of Saab Automobile AB, said in the statement that the deal will enable Saab to boost the brand’s potential through the new product line-up. After several month with nervous waiting, the closure will now add some stability to the crisis-hit car industry.

"Today’s announcement is great news for Saab’s current and future customers, dealers, suppliers and employees around the globe", he said.

Koenigsegg Automotive AB is a Swedish manufacturer of high-performance cars based in Ängelholm. The company was founded in 1994 in Sweden by Christian von Koenigsegg. Koenigsegg is financially backed up by Norwegian industrial designer Bård Eker, who owns 49 percent of the carmaker. Eker told Norwegian media at the weekend that "several investors" were backing his bid to buy Saab, but would not disclose their names.

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