Spain, Britain refuse aid to German-backed Opel sale to Magna
09 October 2009
Spain and Britain have refused to lend money to General Motors' European division Opel, which was acquired by Canadian vehicle parts maker Magna International last month.
Chancellor Angella Merkel is reported to have pushed on the US administration to lean on GM to do the deal with Magna, rather than Fiat. Last month, GM finally announced that it had chosen Magna International, a Canadian vehicle parts group, which would take a 55-per cent stake in Opel and Vauxhall. erman
Under the deal, Magna will own 22.5 per cent of Opel along with consortium partner Sberbank, the Russian state-owned lender, who will own another 22.5 per cent, with GM retaining a 35-per cent stake while Opel employees would hold 10 per cent.
The deal came after months of intense bidding from Fiat, RHJ International and Chinese carmaker BAIC.
The Ontario-based Magna was not the favourite to acquire Opel initially until the German government, in a bid to save jobs in Germany said that the Magna proposal was far superior to the others.
Magna's offer was more beneficial to Opel employees in Germany since the Canadian company said that it would not shut any of the four German plants, which employs 25,000 people out of Opel's 50,000 workers employed in Europe.