Toronto, July 22 (Inditop.com) Canadian auto-parts giant Magna and the Savings Bank of the Russian Federation (called Sberbank) have jointly submitted a bid to acquire a 55 percent stake in the troubled General Motors’ Opel. Belgium’s investor RHJ International and China’s Beijing Automotive Industries are the other two bidders.
July 20 was the last day to submit bids to GM which is selling Opel as part of its massive restructuring plans.
In a statement here Tuesday, the Canadian auto company said: “The (fresh) offer was made in response to a request by General Motors for final offers regarding Opel.
The offer contemplates a total equity investment by the (joint) consortium of Euro 500 million over time.”
The ailing General Motors, which has received $50 billion bail-out loans from the US and Canadian governments, will now review offers and decide the sale process. Both the US and Canadian governments currently hold a 72 percent stake in GM.
Magna, the world’s third largest auto parts maker based at Aurora near Toronto, said their joint offer was “intended to assure the long-term viability of Opel.”
If the offer is accepted, Magna and the largest Russian bank will have an equal stake in their 55 percent interest in Opel, with GM retaining 35 percent, and Opel employees acquiring 10 percent under a new labour deal (brokered by the government of Germany where Opel is headquartered).
The statement by Magna said if their bid is successful, they will “put in place appropriate ‘firewalls’ to ensure that its current business will operate independently from Opel.”
Magna and the Russian bank had submitted their proposal to the German government in May before GM declared bankruptcy May 30.
To allay German concerns, Magna has promised to keep all German plants open and axe only 10,000 of the total 50,000 jobs.
Magna’s consortium with the largest Russian bank reportedly has the backing of the US, Canadian and German governments because of the emerging middle class in Russia which could fuel Opel’s long-term recovery.
Being the majority stake holders in GM currently, the US and Canadian governments have a big say in the bidding process.
The German government has also become a big player in the process as it had negotiated and underwritten a deal to transfer Opel assets to a new company before the GM bankruptcy.
