Fiat SpA's revised offer for General Motors Corp.'s Opel division, which may require 3 billion euros ($4.19 billion) in German government loan guarantees, doesn't provide a broad enough car-industry concept to win backing, a state minister involved in the talks said.
Fiat would eliminate fewer than 10,000 jobs in Europe, including 1,600 to 2,000 positions in Germany, according to two people familiar with the plan. The guarantees would be part of 6 billion euros in backing that the Turin, Italy-based carmaker would seek from governments across Europe, said the people, who asked not to be identified because the plan is confidential.
"Whoever presents a concept with an unsound basis and then rushes to improve on it acknowledges that the plan was flawed in the first place," Hendrik Hering, Rhineland-Palatinate's economy minister, said in a phone interview. "I can't imagine" that Fiat's improved offer will dispel doubts, he said today. Hering declined to disclose details of Fiat's new proposal.
GM is selling a majority stake in Ruesselsheim, Germany- based Opel, including the U.K. Vauxhall brand, to secure the unit's survival as the U.S. parent company faces a deadline of June 1 to reorganize or go into bankruptcy.
Fiat's competitors for the Opel stake are Magna International Inc., Canada's biggest car-parts maker, and RHJ International SA, an investment fund with automotive assets including some former holdings of private-equity firm Ripplewood Holdings LLC. German federal and state government officials aim to decide tomorrow on which offer they'll support.
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