GM to sell Opel to Magna (With conditions)

Germany's Chancellor Angela Merkel herself has confirmed that GM is ready to sell Opel to Magna. The offer comes with yet to be disclosed conditions. However, according to news-adhoc, Frau Merkel “doesn’t have the impression that behind the announcement of Opel is a hidden agenda that sets the threshold so high that in the end there won’t be a sale.” This is politico-speak for: “Do we smell a rat here?” Das Handelsblatt has more details.

Magna/Sberbank will take over 55 percent of Opel, GM will retain 35 percent and the workers will hold a 10 percent share. Opel will “remain integrated in the worldwide development network of GM.” On the list of open issues: A written confirmation of the workers that they “will support the necessary cost adjustments” (i.e., take expensive haircuts) and a definitive financing package by the German government.

The Opel Trust also approved the deal, says Finanznachrichten.de. Interesting: The Opel Trust holds Opel as security for the €1.5 billion bridge loan. The board of the trust had to vote. Manager Magazin writes that there was one vote against: By the representative of the German government, Manfred Wennemer. He thinks Opel’s costs are too high, their Russian goals unreachable. Thumbs down. Also interesting: The representatives of the states, where Opel has factories, abstained. The deal was approved with the votes of the GM representatives on the board. As for factories, all German factories will be kept open.The factory in Antwerp will be shuttered. In the UK, “Magna said it was committed to keeping Vauxhall’s Ellesmere Port plant open,” says the BBC. “Doubts remain about the firm’s Luton plant.”

According to Das Handelsblatt, GM “played poker until the end.” In the end, GM realized that they don’t have the money to hold on to Opel. Yet, the deal is still far from closed. Das Handelsblatt heard from governmental sources: “Whether Magna can live with GM’s conditions won’t be decided before the election date. After that, we will see.”