A Swedish appeals court has given the green light for beleaguered carmaker Saab to reorganise under bankruptcy protection, delaying what had appeared to be the company's imminent demise.
"The appeals court reverses the district court ruling and allows Saab ... to reorganise," the Appeals Court for Western Sweden said in its decision on Wednesday.
The ruling places on hold thousands of individual requests that Saab be declared bankrupt by company employees and union members who have yet to receive their August wages.
It also makes it possible for Saab's around 3,700 employees to receive their salaries.
"The threat of bankruptcy is gone and our employees will be paid ... This is a good day," enthused company chief executive Victor Muller.
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The appeals court said the lower court's finding that Saab was lacking the goodwill and brand strength needed for the reorganisation to succeed was unfounded and gave the company three months to turn itself around.
"In this case, the appeals court deems that a more in-depth probe could show that there is a basis for a successful reorganisation," it said.
Due to towers of unpaid bills, suppliers have stopped deliveries and the Swedish carmaker has seen an almost uninterrupted halt to production since April.
Saab's Dutch parent company Swedish Automobile has however argued it only needs to keep its creditors at bay until regulatory approval goes through for its anticipated cash injection of 245 million euros ($A328.7 million) from its Chinese partners Pang Da and Youngman.
The company, which says it has about 150 million euros in outstanding debt, has said it expects that cash influx in November.
Muller has repeatedly said he is "very confident" the Chinese funds would come through, and announced last week Saab had secured a 70-million-euro bridge loan deal to help it stay afloat until they did.
Swedish Automobile said on Wednesday it planned to spend the next few weeks identifying ways of streamlining Saab and creating a more flexible cost structure.
"As a result of this initiative, headcount reductions cannot be ruled out," it said in a statement, adding that "all improvements should be implemented before year-end in order for Saab Automobile to have a new, competitive cost structure for the 2012 financial year."
Two of the three unions that had filed for Saab's bankruptcy meanwhile hailed the court's decision, saying they would withdraw their requests since the granted reorganisation would allow their members to quickly tap into a state-held wage guarantee fund.
"The salaries should be on our members accounts within a few days," IF Metall, which counts some 1,500 blue-collar members at Saab's Trollhaettan factory in southwestern Sweden, said in a statement.
Not everyone agreed with the decision.
"This is not good ... There is no basis for this reorganisation to succeed," Rolf Aabjoernsson, a lawyer and reorganisation specialist, told TT.
Marie Karlsson-Tuula, another reorganisation specialist, agreed.
"I think it is incredible considering that they have no production," she told TT.
Wednesday's announcement came just two and a half years after the carmaker last went through a large-scale restructuring to avoid bankruptcy, when it was still owned by US car giant GM and wrote down 75 per cent of its debts.
