By John Revill of AutoWeek
http://editorial.autos.msn.com/article.aspx?cp-documentid=1027812
Fiat S.p.a. and Magna International Inc. are emerging as rival bidders for a significant stake in General Motors’ Opel/Vauxhall subsidiary.
Magna International and Russian oligarch Oleg Deripaska are considering taking a 50 percent share in Opel, Canada’s Globe and Mail reported on Monday.
Magna would purchase about 20 per cent of Opel and Deripaska would possibly combine with Russian banks to pick up another 30 per cent, the newspaper said.
German politicians and Opel’s union bosses say Fiat wants a controlling stake in Opel.
Italian sources told Automotive News Europe that Fiat and Magna are rival investors in Opel.
Fiat is sweetening its bid by offering to build its Punto hatchback in Opel’s plant in Eisenach, Germany, to help maximize the plant’s production capacity, German daily Handlesblatt reported Tuesday. The Punto shares its platform with the Opel Corsa, which is built at Eisenach.
Magna Plan for Opel ‘Interesting’
Opel’s union chiefs and some German politicians have spoken out against Fiat taking a stake in Opel. They fear massive job cuts, plant closures and believe a partnership would not work because there is too much overlap between the brands.
Fiat has pledged to maintain all of Opel’s four German production sites should it acquire the company, Der Spiegel reported at the weekend.
Fiat’s reported offer to build the Punto in Eisenach and keep open Opel factories did not impress union representatives.
“It changes nothing,” Opel’s works council chairman Klaus Franz told Handlesblatt.
German Economy Minister Karl-Theodor zu Guttenberg met senior representatives of Magna on Tuesday to discuss its possible investment in Opel. After the meeting,
Guttenberg said Magna had presented an interesting initial rough plan to invest in Opel.
Guttenberg added that the government still needed hard facts and figures from GM to back up Magna’s plans for Opel.
Cash-strapped GM is carving out German-based Opel and its British sister brand Vauxhall into a separate unit and is seeking outside equity investors to give Opel a major cash infusion.
GM must sell a significant stake in Opel to convince German politicians to provide billions of euros in loan guarantees to the carmaker and, with an election due in September, the government is anxious to find a way of saving jobs at the company.
GM Favors Single Bidder
GM favors one major investor rather than a combination of bidders but wants to retain a stake in a new independent Opel, a company source familiar with the negotiations told ANE.
GM wants to agree a memorandum of understanding with a bidder in the next two to three weeks, the source said.
GM CEO Fritz Henderson told news conference Monday that talks between Opel and several parties interested in investing in the automaker will continue until mid-May.
Henderson said GM would retain a substantial interest in Opel’s European business.
A GM Europe spokesman said: “We continue to aggressively work to secure third party investment. Time is of the essence. It is a complex situation with several parties in the mix and this is going to take some time.”
Douglas A. Bolduc and Reuters contributed. Content provided by AutoWeek.
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John Paul Strong
John Paul Strong combines his two decades of automotive marketing experience with a team of more than 150 professionals as owner and CEO of Strong Automotive.
