NewsFeeder

AutoBlog: BREAKING: BBC says Magna has agreed to take majority stake in Opel from GM

19 posts in this topic

Filed under: Trends, Euro, Government/Legal, GM, Earnings/Financials, Opel

opel-logo-580x.jpg

According to the BBC News, supplier Magna International has come to terms with General Motors to purchase a majority stake in its European Opel division. While an agreement has been reached between the two parties, the German government - which has agreed to provide financial assistance for Opel - needs to sign off on the matter. Magna and GM have signed a memorandum of understanding that will reportedly help Opel secure some 1.5 billion euros ($2.1B USD) in bridge loans, as well as shore up protections against creditors in the event of a GM bankruptcy.

For its part, Magna will reportedly pour somewhere between 500-700 million euros into Opel, and it plans to cut 10% of the marque's workforce in Germany - about 2,500 employees.

Interestingly, GM will reportedly hold on to a 35% stake in the brand, while Opel workers themselves will end up with 10% of the company. No word yet on what will happen to Vauxhall, Opel's UK twin. Thanks to everyone for the tips!

[source: BBC]

BREAKING: BBC says Magna has agreed to take majority stake in Opel from GM originally appeared on Autoblog on Fri, 29 May 2009 13:27:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments

di
di

autoblog?i=Wak0GvVPEK8:qzoZmYGC-R8:wF9xT autoblog?i=Wak0GvVPEK8:qzoZmYGC-R8:V_sGL
Wak0GvVPEK8

View the full article
0

Share this post


Link to post
Share on other sites
GM keeps 35%??!?

Which platforms does Opel still have a hand in? I know Epsilon is a big one.

0

Share this post


Link to post
Share on other sites
Which platforms does Opel still have a hand in? I know Epsilon is a big one.

No doubt that is the crux of the situation. I remember PCS posting about Opel "wanting its freedom", and my responding that GM would protect its access to the platforms it needed.

Seems I was right.

0

Share this post


Link to post
Share on other sites

It would have been a bad chess move if GM would have sold the entire stakes in Opel. This is good news. I did not want GM to just give away Opel to the other vultures more for its intellectual input and efforts it has put in Opel.

0

Share this post


Link to post
Share on other sites

I think this is great news given the situation. GM keeps their mitts on a good chunk of Opel, and Frankie gets his car company. I wonder if this means that we could see Opel's being produced in North America?

0

Share this post


Link to post
Share on other sites

Interesting, I am glad this got done and I think this will be good for all involved.

0

Share this post


Link to post
Share on other sites

GM gets 35% and workers get 10%. Together not a controlling stake, but enough for GM not to lose control of Opel to a competitor such as Fiat.

0

Share this post


Link to post
Share on other sites
I think this is great news given the situation. GM keeps their mitts on a good chunk of Opel, and Frankie gets his car company. I wonder if this means that we could see Opel's being produced in North America?

If they are, I wonder if Frank would try to get a no-strike clause in the deal

0

Share this post


Link to post
Share on other sites
will magna make cars for...........Saturn?

I don't think so. I think Opel will be building Opels and Vauxhalls, and possibly Buicks (rebadged Opels). In fact, if GM's Chapter 11 process is quick enough and "New GM" emerges as profitable and viable in the long run, I'd see a deal structured so Magna would become a shareholer in "New GM" and GM would again control Opel.

0

Share this post


Link to post
Share on other sites
If they are, I wonder if Frank would try to get a no-strike clause in the deal

I wouldn't be surprised if he'd go for that, seeing as that's pretty much his policy. The CAW would probably go for it because they're generally on good terms with Magna, and the possibility of opening new plants in the future would be hard to pass up seeing as others are shutting down.

0

Share this post


Link to post
Share on other sites
I don't think so. I think Opel will be building Opels and Vauxhalls, and possibly Buicks (rebadged Opels). In fact, if GM's Chapter 11 process is quick enough and "New GM" emerges as profitable and viable in the long run, I'd see a deal structured so Magna would become a shareholer in "New GM" and GM would again control Opel.

the saturn sales guy i talked to sat said hopes are high that saturn is split off and that magna will be contracted to make saturns. one possibility.......maybe.

0

Share this post


Link to post
Share on other sites
the saturn sales guy i talked to sat said hopes are high that saturn is split off and that magna will be contracted to make saturns. one possibility.......maybe.

Hmmm..... I don't think the idea of aligning Opel and Buick will be in jeopardy with this deal... Magna could always assemble previous generation Opels wearing Saturn badges, but that could be a disaster as Saturn would always be a generation behind in its products. Look at what GM suffered from the perception of being outdated, and where it is right now...

The idea of an OEM that needs to increse dealer penetration/coverage buying Saturn is a lot more interesting from a business perspective. The badge would probably go down, but at least those dealers would be guaranteed product.

0

Share this post


Link to post
Share on other sites

well i guess good GM and the govt have screwed saturn fans over........FIGURES. NO OPELS in the USA. this probably means the only chance in hell of getting one here is through buick, where fiber supplements are spiked in the coffee at the service counter........

http://www.washingtonpost.com/wp-dyn/conte...3002146_pf.html

Political complications aren't limited to emerging markets. The Treasury has imposed a condition on the Opel deal that flies in the face of free markets, but is designed to shield existing U.S. jobs; Opel must be barred from selling cars or setting up manufacturing plants in the United States. And the Treasury insisted that, at least for a time, Opel stay out of China, where GM is strong.

f-k this. GM is even barring itself from selling some of its best product here AGAIN. the task force is fine selling you a cruze and that's about it

at least if i buy a buick i suppose i am helping bring the buyer demographic down 26 years. this is amazing how much this sucks.

Edited by regfootball
0

Share this post


Link to post
Share on other sites

http://www.reuters.com/article/companyNews...133257820090601

WASHINGTON, June 1 (Reuters) - The Obama administration denied on Monday that it insisted that European automaker Opel be barred from the U.S. and Chinese markets after General Motors Corp sells a majority stake, saying that any such decisions were up to GM.

The Washington Post reported that Opel's new controlling shareholder, Magna International (MGa.TO), has agreed to refrain from selling Opel cars in the United States or setting up U.S. factories, and at least for a time to stay out of China, adding that the condition was demanded by the U.S. Treasury.

This would shield GM's surviving brands, such as Chevrolet and Buick, from having to compete in the automaker's two most important markets with Opel vehicles that share common GM-developed chassis platforms and that would be similar in size and features.

"Newspaper accounts that Treasury is insisting that Opel stay out of the U.S. or Chinese markets are incorrect. The U.S. government strongly supports free markets," Treasury spokeswoman Jenni Engebretsen said.

However, an Obama administration official added that to the extent any arrangements were made by GM regarding Opel's access to the U.S. or Chinese markets, these were made solely as business decisions by GM, and not in response to requests by the U.S. government.

The U.S. government will own about 60 percent of GM's common equity in the restructuring plan now underway in U.S. bankruptcy court in New York. Canada will take a 12 percent stake.

The plan is aimed at making GM profitable even if auto market conditions remain difficult and industry sales run at about a 10-million-unit annual rate.

In Detroit, GM Chief Executive Fritz Henderson said it was very important that GM reach agreement to resolve the future of Opel before GM filed for bankruptcy protection on Monday.

He said he was personally involved in "middle of the night" negotiations on Opel and the parties arrived at a solution that works for the automaker, including good support from the German government.

Magna has said it intends to use Opel, with the bulk of its operations in Germany, as a platform to push into the growing Russian car market. (Reporting by David Lawder; Editing by Dan Grebler)

0

Share this post


Link to post
Share on other sites
Interesting, I am glad this got done and I think this will be good for all involved.

+1

Chris :convertible:

0

Share this post


Link to post
Share on other sites

Your content will need to be approved by a moderator

Guest
You are commenting as a guest. If you have an account, please sign in.
Reply to this topic...

×   You have pasted content with formatting.   Remove formatting

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor