Magna Emerging As Preferred Buyer for Opel
The governor of German state Hesse, where GM’s Opel is based, has come out in support of Magna’s bid for the automaker.
“I think there is a certain ranking, in which the offer from the Magna group is certainly the one that is closest to the hopes and wishes of, I think, many in German politics but also among employees,” Governor Roland Koch said on Deutschlandfunk radio.
Magna is up against Italian automaker Fiat, which hopes to acquire Opel and Vauxhall to create the world’s second-largest automaker behind Toyota, and a New York-based buyout firm called Ripplewood Holdings. Very few details of the bids submitted by the three companies vying for Opel have been released.
According to Reuters, Magna’s plan would divvy up ownership between Opel and “Russian partners” (35 percent each), Magna (20 percent) and employees of the company (10 percent). Magna co-CEO Siegfried Wolf also said that the company would keep all four of Opel’s German-based plants, but couldn’t promise the same for plants in England and Antwerp.
Both German politicians and Opel workers have been critical of Fiat’s bid, despite Fiat CEO Sergio Marchionne’s assurances. At issue are the possible job cuts that could accompany a Fiat takeover. While Opel union officials had estimated the cuts could number up to 18,000, Marchionne has said the cuts would be less than 10,000, and would not be concentrated in any one area of Europe.
Still, Fiat’s bid has failed to gain support.
Koch said that “there is a very interesting offer from a financial investor with the Ripplewood group and certainly some… are a little disappointed that Fiat’s offer is a very long way from what one perhaps hoped for in some places.”
“The German government has three concepts; we are evaluating these concepts internally, but we will not participate right now in public speculation and evaluations,” German Economy Ministry spokesman Steffen Moritz said.
GM must ultimately decide who Opel’s investor will be, but the German government will decide if state funds will be used for financing the deal.