Beijing automotive bids for GM's Opel

General Motors Corp., the world's largest auto manufacturer reeling under bankruptcy, has confirmed on Friday that it received an offer from the Chinese firm Beijing Automotive Industry Holding Co. (BAIC) for acquiring a stake in its European unit Adam Opel GmbH.

It is believed that the Chinese offer is the third one in the race for Opel, with the Canadian-Austrian autoparts maker Magna backed by Russia's Sberbank being the frontrunner. The other bidder is Beligium's RHJ Holdings International.

Sources close to GM said that the Chinese offer is indicative and non-binding. Financial Times reported that the BAIC offer for equity stake is valued at $921, citing people close to the deal.

State-owned BAIC is the holding company of Chinese automobile and machine manufacturer Beijing Automotive Import & Export Corporation, and founded around joint ventures with western automakers viz. Jeep and Daimler-Benz, producing over 700,000 vehicles annually.

About a month ago, GM selected Magna as the preferred bidder for divesting a stake in Opel and a memorandum of understanding (MOU) to this effect was signed by the two sides.

As per the deal, Magna along with its Russian partner Sberbank would acquire a 55-per cent stake in the new company with the GM stake reduced to 35-per cent and the remaining 10-per cent controlled by Opel's employees. (See: Opel picks Magna; job cuts loom over European plants)