Magna remains Berlin's favourite to take over Opel

AFP - [email protected]
Magna remains Berlin's favourite to take over Opel
Photo: DPA

Berlin is still backing the bid of Canadian car maker Magna to take over the struggling General Motors subsidiary Opel, a spokesman said Wednesday.


The German government had already expressed a preference for Magna's bid, backed by Russian bank Sberbank, before receiving other offers from Belgium-based

investment group RHJ International and Chinese company BAIC, spokesman Ulrich Wilhelm told a regular briefing.

"This assessment ... has been confirmed following our examination (of the

bids)," he added, following a meeting of the government's "Opel task force"

with GM executives,.

While the final decision lies with GM, the German Government is involved as

it is set to stump up billions of euros in loan guarantees to

sweeten any takeover deal in a bid to save tens of thousands of jobs.

Berlin and GM "want to come to a joint assessment in the coming weeks,"

with the hope of wrapping up the already lengthy saga in the next few months, he said.

"You know that the federal government is not the seller. At the end of the

day, we can only decide about the loans and loan guarantees. The seller is GM.

"Conversely, a sale can only occur in a sustainable fashion after the

governments in Europe assure these loans and guarantees," he added.

In late May, the German government agreed to support with cheap loans and

loan guarantees a bid for a majority stake in Opel by Magna, which besides

Sberbank has also teamed up with Russian automaker GAZ.

Magna and Sberbank will each purchase a stake of 27.5 percent. Previously

Magna had only declared itself ready to acquire a 20 percent stake. They still seek €4.5 billion in state guarantees.

Russian business daily Kommersant reported on Monday that Magna would also demand that GM include intellectual property rights as part of any Opel deal.

For their part, RHJ International is seeking €700 million less in state guarantees than Magna and would buy a 50.1 percent stake for €275 million. RHJ International is thought to be planning around 8,100 job losses Europe-wide in the Opel business.

The German government said in May that Magna's plan involved around 2600 jobs shed in Germany, with a further 8,500 elsewhere in Europe.

BAIC's preliminary offer is valued at €660 million and it has asked for €2.64 billion in German government guarantees.



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