Opel deal set to face bids from rivals
- Source: Shanghai Daily
- [08:59 June 09 2009]
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By Gianni Montani
Signs emerged yesterday that Canada's Magna could face challenges to its deal for General Motors' European unit Opel as Fiat SpA said it was still interested and Germany invited rival bidders to improve their offers.
Fiat, the Italian auto maker, lost out last week to the Canadian car parts maker Magna in bidding for GM's Germany-based Opel and British brand Vauxhall, but Fiat Chief Executive Sergio Marchionne said the deal was not yet sealed.
"The interest is still there, it doesn't depend on us," he told reporters in Turin where Fiat is based. "The deal technically is not closed, we will see."
Asked about Fiat's other expansion plans, Marchionne said its interest in GM's Swedish unit Saab was "minimal" without Opel.
Fiat has no talks under way with PSA Peugeot Citroen SA, he said. The French company is often mentioned as a potential Fiat tie-up partner.
Marchionne said Fiat had not yet used a 1.0 billion euro (US$1.4 billion) credit it had with the banks.
Fiat has said its focus is turning around ailing United States car maker Chrysler. Marchionne had seen Opel as key to his goal of putting Fiat among the top global auto makers by output.
Berlin clinched a deal last week with Magna and the US government that includes state-backed loans and loan guarantees worth 4.5 billion euros.
The deal aims to shield the company and thousands of jobs from GM's Chapter 11 bankruptcy filing.
Magna and Russian bank Sberbank agreed in principle on May 29 to take a joint 55 percent stake in Opel, with Magna lending 300 million euros to cover short-term needs.
Although Magna's plan put it in a strong position, a German government spokesman said it could not be ruled out that other bidders could improve on its offer.
Besides Fiat, China's Beijing Automotive Industry Corp has also shown interest in Opel. It has hired PricewaterhouseCoopers to advise it on a takeover bid, a source familiar with the matter said on Thursday.
GM Europe Chief Executive Carl-Peter Forster said yesterday he expected a definitive pact with Magna by July and the deal to close by September.
Writing on a GM Europe web log, he cautioned that although both parties were committed to completing the deal, "much work remains and much could happen along the way."
In an interview with Austria's Format magazine, Magna co-CEO Siegfried Wolf said he would keep Magna and Opel separate in the interest of Magna's other clients.