General Motors Receives Final Bids for Opel Unit Amid Ongoing Negotiations

Strategic Insights -

General Motors Corp. has revealed that it has received three final offers from three companies for its Opel unit, with the company stating that a decision is yet to be taken. The three bidders are a consortium of Canadian auto parts maker Magna International Inc. and Russian lender Sberbank, RHJ International SA, and China's Beijing Automotive Industry Corp. The final bids will be analyzed and compared by GM, with the company set to review its preliminary findings with the German and other impacted governments, the EU Commission, and the Opel/Vauxhall Trust Board.

Key Takeaways:

  • The three final bidders for Opel are RHJ International SA, a consortium of Magna International Inc. and Sberbank, and Beijing Automotive Industry Corp.
  • Magna International Inc. has increased its bid for Opel from 20% to 27.5%, under a new plan that would see the company and Sberbank own 55% of Opel, with GM retaining 35% and Opel employees owning 10%.
  • The deal would allow Magna to increase shipments of vehicles and parts from Europe to Russia, which could become Europe's largest car market, surpassing Germany.
  • RHJ International SA's bid would see it cut up to 10,000 jobs at Opel, which employs 25,000 people in Germany.
  • General Motors is seeking to retain access to Opel's technology, with Vice Chair of Global Product Development Tom Stephens stating that "there is no scenario where I don't have full access to the intellectual property".
  • The final bids were submitted to GM by the close of business on July 20, as requested by the company.

Statistics:

  • 3: the number of final bids received by General Motors Corp. for its Opel unit
  • 27.5%\: the percentage of Opel ownership that Magna International Inc. hopes to acquire
  • 55%\: the combined ownership percentage of Magna and Sberbank in Opel
  • 35%\: the percentage of Opel ownership retained by General Motors under Magna's bid
  • 10%\: the percentage of Opel ownership retained by Opel employees under Magna's bid
  • 25,000: the number of people employed by Opel in Germany
  • 10,000: the maximum number of jobs that could be cut at Opel under RHJ International SA's bid

Sources:

  • "GM receives final bids for Opel unit, but decision is yet to be taken," By George Frey and Matt Moore, FRANKFURT, from the Wall Street Journal, no date provided.