UPDATE 1-UK's Mandelson says close to Magna-GM finance deal

* Mandelson: 'One or two issues' to be resolved on financing

* Deal on UK share of financing could be signed within days

(adds quotes and background)

LONDON, Oct 29 (Reuters) - British Business Secretary Peter Mandelson said on Thursday that Britain was closer to agreeing a financing package to support Canadian auto parts maker Magna's MGa.TO takeover of General Motors' GM.UL operations in Europe.

"Yes I think we are (close to agreement)," he told reporters. "I had further discussions last evening. I think there are just one or two issues to be resolved between the European governments and Magna."

German Chancellor Angela Merkel's government has offered 4.5 billion euros ($6.63 billion) in guarantees for Magna's takeover of Opel, GM's European arm, which owns the UK brand Vauxhall.

She said that Germany and the other European countries with GM car plants would decide later how to split those guarantees. The British share will be worth about 400 million pounds ($657.8 million), according to unconfirmed British media reports.

Mandelson said he hoped a deal on the UK share of the financing could be signed in the next few days, but he would not confirm a date or the scale of that financial help.

"It is a matter for subsequent discussion. We will be paying our fair and reasonable whack," he added.

European competition authorities' concerns over the promise of state aid has delayed the formal signing of a deal between General Motors [GM.UL] and Magna and its partner, the Russian state-owned bank Sberbank SBER03.MM.

However, GM Chief Executive Fritz Henderson said he was "reasonably confident" the deal could be finalised soon after the German government gave assurances to the European Competition Commissioner Neelie Kroes,

The deal would give Magna and Sberbank a 55 percent stake in Opel. GM filed for U.S. government-supported bankruptcy in June. (Reporting by Adrian Croft; editing by Elaine Hardcastle)