3 companies bid for GM Europe
05-23-2009, 07:00 AM
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3 companies bid for GM Europe
Three bidders — possibly four — have offered to acquire part or all of General Motors Corp.’s ailing Adam Opel GmbH unit, people familiar with the situation said Wednesday.
The bidders include Fiat SpA of Italy, Canadian supplier Magna International Inc. and Ripplewood Holdings LLC, the sources said. A group of Opel dealers and employees is offering a fallback proposal to save the Ruesselsheim, Germany-based carmaker in the event the other bids are rejected.
GM Europe spokesman Chris Preuss told the Associated Press that at least three bids had been received but did not identify the bidders.
Fiat confirmed Wednesday that it had submitted an offer for the European business of Opel and Vauxhall. (Vauxhall is how Opel cars are branded in Britain.)
“Should this transaction be concluded, a new company encompassing the activities of Fiat Group Automobiles (including its stake in Chrysler) and Opel would be created,” the Turin-based company said in a statement.
Fiat is proposing to combine its auto business — excluding the Maserati and Ferrari brands — with its prospective interest in Chrysler, and GM’s European and Latin American operations to create a large group with more than $100 billion in annual sales.
Fiat Chief Executive Sergio Marchionne reiterated Tuesday that Fiat would not offer cash for Opel but would bring assets that were worth money.
Opel’s employee representatives are concerned that the overlap between the Opel and Fiat product lines will lead to big production cuts and job losses in Western Europe. Some have expressed a preference for a deal with Magna, which wants to expand its car-making activities. Magna bid for Chrysler in 2007.
Magna has previously said it was considering a stake in Opel, as has the organization representing Opel dealers in Europe. Last Friday, the European Opel Dealer Association endorsed a plan to seek a minority stake of up to 20 percent by investing 500 million euros ($680 million).
German government officials said this week Opel would receive bridge loans to stay afloat while the bids are being studied. GM has asked Germany for financial assistance for Opel.
Regional authorities and bank officials, speaking on condition of anonymity because the plan had not been finalized, confirmed that the financing would come from federal and state governments as well as state-controlled banks.
Opel has said it will need 1 billion euros ($1.4 billion) in fresh capital over the next month. The German state of Rhineland-Palatinate is willing to contribute about 10 percent of that, provided that Opel’s factory in Kaiserslautern is spared, the state’s agriculture minister, Hendrik Hering, told Suedwestrundfunk radio Wednesday.
Fiat’s Marchionne called that factory’s future into question when he presented the initial outlines of the carmaker’s plan to take over Opel earlier this month.
With elections coming up in Germany in September, politicians from both parties in the “grand coalition” government are eager to preserve a carmaker that employs some 25,000 people in Germany, nearly half of GM Europe’s total work force.
Preuss said GM Europe has a “pretty detailed process that we’re going to have to work through with all the interested parties” before any decision is made among the bidders.
“We’re looking at a matter of several weeks, if not months, here to get through the whole process,” he said.
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The bidders include Fiat SpA of Italy, Canadian supplier Magna International Inc. and Ripplewood Holdings LLC, the sources said. A group of Opel dealers and employees is offering a fallback proposal to save the Ruesselsheim, Germany-based carmaker in the event the other bids are rejected.
GM Europe spokesman Chris Preuss told the Associated Press that at least three bids had been received but did not identify the bidders.
Fiat confirmed Wednesday that it had submitted an offer for the European business of Opel and Vauxhall. (Vauxhall is how Opel cars are branded in Britain.)
“Should this transaction be concluded, a new company encompassing the activities of Fiat Group Automobiles (including its stake in Chrysler) and Opel would be created,” the Turin-based company said in a statement.
Fiat is proposing to combine its auto business — excluding the Maserati and Ferrari brands — with its prospective interest in Chrysler, and GM’s European and Latin American operations to create a large group with more than $100 billion in annual sales.
Fiat Chief Executive Sergio Marchionne reiterated Tuesday that Fiat would not offer cash for Opel but would bring assets that were worth money.
Opel’s employee representatives are concerned that the overlap between the Opel and Fiat product lines will lead to big production cuts and job losses in Western Europe. Some have expressed a preference for a deal with Magna, which wants to expand its car-making activities. Magna bid for Chrysler in 2007.
Magna has previously said it was considering a stake in Opel, as has the organization representing Opel dealers in Europe. Last Friday, the European Opel Dealer Association endorsed a plan to seek a minority stake of up to 20 percent by investing 500 million euros ($680 million).
German government officials said this week Opel would receive bridge loans to stay afloat while the bids are being studied. GM has asked Germany for financial assistance for Opel.
Regional authorities and bank officials, speaking on condition of anonymity because the plan had not been finalized, confirmed that the financing would come from federal and state governments as well as state-controlled banks.
Opel has said it will need 1 billion euros ($1.4 billion) in fresh capital over the next month. The German state of Rhineland-Palatinate is willing to contribute about 10 percent of that, provided that Opel’s factory in Kaiserslautern is spared, the state’s agriculture minister, Hendrik Hering, told Suedwestrundfunk radio Wednesday.
Fiat’s Marchionne called that factory’s future into question when he presented the initial outlines of the carmaker’s plan to take over Opel earlier this month.
With elections coming up in Germany in September, politicians from both parties in the “grand coalition” government are eager to preserve a carmaker that employs some 25,000 people in Germany, nearly half of GM Europe’s total work force.
Preuss said GM Europe has a “pretty detailed process that we’re going to have to work through with all the interested parties” before any decision is made among the bidders.
“We’re looking at a matter of several weeks, if not months, here to get through the whole process,” he said.
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