General Motors Corp.'s Opel division, which is running out of cash as its parent faces potential bankruptcy by June 1, needs to find an investor within weeks, the German unit's top labor leader said.
"We have to reach a decision in the coming weeks," Klaus Franz, head of Opel's works council, said late yesterday in an interview at the manufacturer's headquarters in the Frankfurt suburb of Ruesselsheim. "We don't have too much time."
Magna International Inc., Fiat SpA and unidentified financial investors are vying for stakes in Opel, which also sells cars in the U.K. under the Vauxhall brand. Detroit-based GM, surviving on U.S. loans, can't provide financial support to Opel and is looking to sell a stake in the carmaker to secure 3.3 billion euros ($4.4 billion) in European state aid.
Opel worker representatives have repeatedly ruled out an agreement with Fiat, Italy's biggest manufacturer. Employees have a say in the process as GM's rescue plan for the European unit calls for workers to make $1.2 billion in concessions.
"We are open to working with Magna, but not with Fiat," said Franz. Magna, North America's largest auto-parts maker, would offer Opel access to technology and opportunities to enter new markets, such as in eastern Europe, he said.
Magna, based in Aurora, Ontario, hasn't specified the amount of money it's prepared to invest or the size of the stake it's aiming for, Franz said.
Russian Partners Report
Rheinische Post, citing unidentified people close to the companies, reported today that Magna and Russian partners are seeking 5 billion euros to help fund a stake purchase in Opel. Magna would own 19.1 of the German carmaker, while Moscow-based OAO Sberbank, Russia's biggest lender, and Nizhny Novgorod-based carmaker OAO GAZ would hold 31 percent, the newspaper reported.
GAZ denied on April 23 an earlier reports of interest in Opel. The Russian manufacturer is controlled by billionaire Oleg Deripaska, who held a stake in Magna for more than a year until his rising debts prompted a sale of the holding in October.
Magna executives held talks yesterday with German Economy Minister Karl-Theodor zu Guttenberg in Berlin on possible ties with Opel. The minister, calling Magna's concept for securing the GM unit's viability "interesting," said possible bidders would meet with GM next week to clarify financial data before presenting industrial plans.
The Canadian company has formulated a joint offer with Deripaska and unidentified Russian banks, a German government official said yesterday, without being more specific. Magna's stake in Opel wouldn't exceed 25 percent, the aide said.
'Opel's Expense'
A deal with Turin-based Fiat, which Franz said is offering to invest 400 million euros at most for a majority stake in Opel, "would be a Fiat rescue at Opel's expense," the labor representative said. The two European companies would have a combined 20 billion euros in debt and 1 million vehicles in excess capacity, he said.
Financial investors and private equity firms remain interested in Opel, Franz said, declining to discuss the approaches for fear of scaring them off.
"Investors are like shy deer," he said.
