Swedish boutique supercar maker Koenigsegg Group AB has reached an agreement to acquire General Motors Corp.'s (GMGMQ) Saab Automobile AB unit for an undisclosed sum, the companies said Tuesday.

"Closing this deal represents the best chance for Saab to emerge a stronger company," said GM Europe President Carl-Peter Forster.

Saab, part of GM since 2000, was put up for sale earlier this year as part of GM's efforts to return to profitability. Saab has been loss-making for several years and has suffered an even sharper drop in sales than the other brands being sold or closed in GM's reorganization.

Just 783 Saab models were sold in the U.S. during May, a fall of 64% and less than the Hummer truck brand being offloaded to Chinese investors. May sales in Europe slumped 66% to 2,191 last month, according to data released Tuesday.

Last year, Saab sold a little less than 94,000 cars. It employs about 3,400 workers, most at its main factory in Trollhattan in southwestern Sweden.

Saab was granted creditor protection in Sweden Feb. 20 and GM, also in bankruptcy protection, said it wanted to offload the unit by the year's end. 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 guaranteed by the Swedish government, the companies said in a statement.

Additional financial support is to be provided by GM and Koenigsegg to fund Saab's operations and program investments, including plans to launch several new products that are in the final stages of development, like the long-awaited revamp of Saab's flagship 9-5 model. As part of the proposed transaction, GM will continue to provide Saab with design and powertrain technology during a defined time period.

"Today's announcement is great news for Saab's current and future customers, dealers, suppliers and employees around the globe," said Jan Ake Jonsson, managing director of Saab.

Koenigsegg, based in Angelholm, southern Sweden, was founded by 22-year-old entrepreneur Christian von Koenigsegg in 1994 to make exclusive sports cars for the super-rich. Analysts have questioned whether the boutique car manufacturer has the experience needed to help Saab, but GM's Forster said Koenigsegg's ownership was the best solution.

"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," said Forster.

Swedish union IF Metall welcomed the decision. "It is clearly a different ownership solution, but it is perhaps precisely what is needed to realize Saab's true potential. We have always insisted that we want to see an owner who wants to and can develop Saab and activities in Sweden, with research and development and production," said IF Metall's Stefan Loefven.

GM itself filed for protection from its creditors earlier this month.

Company Web site: www.saab.com

-By Ian Edmondson, Dow Jones Newswires; +46-8-5451-3094; ian.edmondson@dowjones.com