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Opel's future still open as GM mulls new investment plans
Published in Saudi Press Agency on 03 - 09 - 2009


The future of General Motors' Opel European
offshoot remains open, with the giant US carmaker saying Thursday
that all options for future ownership of the company remain on the
table, according to dpa.
This followed a report in the Wall Street Journal saying that GM
wants the governments in Spain, Britain and Poland to provide 1
billion euros (1.43 billion dollars) as part of a restructuring of
the Opel group.
"All options for a solution for Opel are to be examined," a GM
Europe spokeswoman said amid speculation that the Detroit-based
carmaker is considering retaining control of Opel, instead of hiving
off a majority stake in the group, which includes the Opel and
British Vauxhall brands.
Quoting what it said was a GM official involved in the
negotiations, the Wall Street Journal also said the American auto
group was prepared to pour more than 1 billion euros of its own money
into restructuring Opel.
But according to German Press Agency dpa sources GM has been
considering the investment plan in the event that it fails to sell
off the majority stake in Opel to the groups bidding for control.
"Should the negotiations with the bidders not reach a satisfactory
result then alternatives must be examined," said a source close to
the negotiations.
The renewed uncertainty about Opel's future comes in the build-up
to a GM board meeting next week, which is expected to consider plans
for Opel.
About half of Opel's 50,000-strong European workforce is based in
Germany.
Berlin has endorsed a bid from the Austrian-Canadian auto supplier
Magna International to acquire a majority holding in Opel by offering
state-backed guarantees worth about 4.5 billion euros.
The General Motors board decided last month against making a
decision on Opel, with company officials indicating that GM would
like Berlin to consider an alternative offer for its European
subsidiary, drawn up by the Brussels-based private equity group RHJ
International.
RHJ International earlier this week raised its offer for a 50.1-
per-cent stake in what has been described as the New Opel by 25
million euros to 300 million euros in cash.
Berlin has also provided Opel with a 1.5 billion euro bridging
loan to help the car group through its current upheaval.
The talks over Opel come at a crucial time for German Chancellor
Angela Merkel, weeks before a federal election.
The other European nations where Opel has operations - Spain,
Britain and Poland - have been concerned that the financial support
offered by Berlin meant that they would bear the brunt of any cost
cutting launched by the new owners of Opel.
Opel's union leader, Klaus Franz, attacked GM's reported
investment plans as "naive."
He said that Opel needed a minimum of 6 billion euros to help it
develop new models and to press on with a restructuring.
Plunging car sales forced GM to launch earlier this year a major
restructuring of its global operations, including selling off of a
majority stake in Opel.
But since then, the carmaker has emerged from bankruptcy and a new
GM board has been appointed. Also, there are signs the economic
crisis has abated for the global car industry and the world economy
in general.


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