GM Delays Sale of Opel to Magna

Adding to the GM-Opel-Magna soap opera, General Motors just delayed the sale of Opel until it discusses the matter at its November 3 board meeting.

“Given the significance of the Opel transaction, GM’s board will soon meet in its regularly monthly meeting to consider Minister zu Guttenberg’s letter and changes to the Magna/Sberbank proposal that have occurred since its last review on September 9,” said John Smith, GM’s chief negotiator in the Opel sale.

Smith was referring to Germany’s Economy Minister Karl-Theodor zu Guttenberg’s request to GM to confirm that GM chose Magna to buy Opel for business — not political — reasons. The request was prompted by the European Union and its concerns about Germany’s promises of state financial aid.

Meanwhile, GM and Magna will continue working to sort out the remaining open items, including labor cost reductions and the plan to obtain €4.5 billion ($6.8 billion) in state aid from Germany. The labor cost reductions would be in hopes of saving several thousand factory workers’ jobs throughout Europe.

Source: Automotive News