Despite Additional Offers, GM Says Magna Still Frontrunner for Opel

Just a day before it was announced that Beijing Automotive Industry Corp. (BAIC) offered almost $1 billion for Opel, GM Europe President Carl-Peter Forster said he expects a deal with Magna to close soon.

Magna has a “considerable lead” over other potential buyers, Forster told Frankfurter Allegemeine Zeitung, a Sunday newspaper.

“I am quirt confident after a top-level meeting of GM and Magna, where broad consent was reached,” he said. “It’s only about the details.”

Automotive News reported Sunday that BAIC has made GM an offer of 660 million euros (about $923 million) for a 51 percent stake in its European Opel and Vauxhall brands. Belgium-based holding company RHJ International is also in the running for Opel.

Forster’s reassurance comes after news last week that talks had stalled as the two companies tumbled over disagreements regarding GM’s technology and engineering designs, rights to Chevrolet sales in Russia ,and GM’s attempt to insert a buy-back clause into the deal. According to Forster, the patent issues have been resolved, and talks are focused now on how the company would operate in Russia.

“Who will be our local partners there? What happens to the GM factories there and other GM brands in Russia?” he said.

The German government, which brokered the deal- whichconsists of Magna taking a 20 percent stake in Opel, Russian state bank Sberbank taking 35 percent, GM keeping 35 percent and Opel’s dealer taking the remaining10 percent – is less confident. German Deputy Economics Minister Jochen Homann expressed skepticism over Magna’s plans for Opel, but did not state a preference for any of the bidders.

Source: Automotive News