When Spyker bought Saab from GM, they bit off too much than they can chew. Spyker is upside down, under water, or whatever you call it when you have negative equity. They just announced that their debt exceeds their capital. And it looks like they have been dipped by GM: “The negative equity is due to the preferred shares that were issued to GM.”
Preferreds are both equity and debt instruments. Spyker keeps its books according to the Euro-centric IFRS (International Financial Reporting Standards), not according to the U.S.-centric GAAP. Under INFRS, preferreds must be kept on the books as debt if redemption is beyond the control of the company or if dividend must be paid on a periodic basis. You need money to pay those dividends.
2011 Hyundai Equus Photo Gallery
2011 Mercedes-Benz CLS Photo Gallery
2011 Ford Edge Crossover Photo Gallery
Concours D'Elegance Monterey 2010 Photo Gallery
Concours Weekend Monterey 2010 Photo Gallery
Read Article