GM says Beijing Auto has submitted offer for Opel

General Motors Corp. said Beijing Automotive Industry Holding Co. submitted an offer for its Opel division, giving the bankrupt U.S. automaker more options in the event negotiations with Magna International Inc. fail.

Beijing Automotive made the non-binding proposal after examining Opel's books, Chris Preuss, a GM spokesman in Zurich, said Friday by phone, declining to provide details. The Chinese company's bid is being reviewed, he said, adding that talks with Aurora, Ontario-based Magna remain "on track."

Magna, Canada's biggest auto-parts manufacturer, was chosen in May by the German government as the preferred bidder for Opel, which has its headquarters in the Frankfurt suburb of Ruesselsheim. Progress has been slowed by disagreements over rights to use Detroit-based GM's technology and engineering designs, people familiar with the talks have said.

The U.K., where Opel owns two factories making vehicles under the Vauxhall brand, may lend money to help complete the sale to Magna, Business Secretary Peter Mandelson said today.

"We are prepared to financially underwrite that deal," Mandelson told reporters after meeting business, political and labor officials at Vauxhall's factory in Luton, England. Potential government aid would include loans and loan guarantees "for which we have to have interest paid and some securities."

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Beijing Automotive may have an advantage over Magna because it "can demand less capital input from the German government," Stephen Pope, chief global market strategist for Cantor Fitzgerald in London, said in a Bloomberg Television interview. Both Magna and Beijing Automotive have "shadows" because the Chinese may look to "plunder" Opel's technology, while Magna's Russian partners may seek to do the same, he said.

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