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Opel Task Force member does not see deal by August 3
July 30, 2009 / 3:11 PM / 8 years ago

Opel Task Force member does not see deal by August 3

<p>The logo of German carmaker Opel is pictured in Berlin, July 27, 2009. REUTERS/Tobias Schwarz</p>

FRANKFURT (Reuters) - A member of the German government’s Opel Task Force told Reuters on Thursday that negotiations between General Motors GM.UL and the two competing bidders for Opel could drag on longer than expected.

A final decision by GM’s new board of directors over whether a controlling stake in Opel should be given to RHJ International RHJI.BR or Magna MGa.TO during the board’s very first meeting was unlikely, said Thomas Schaefer.

“The process is just not far enough along from today’s point of view,” he told Reuters in an interview on Thursday.

Schaefer, who is also state secretary in the finance ministry of Hesse, represents the interests of his state and three others that are home to Opel manufacturing plants.

In a blog entry posted on the GM Europe’s website on Tuesday, chief negotiator John Smith said he still expected a deal to close by the end of September, although no preference has been made yet for one of the two bidders, and key points with Magna’s offer still had to be resolved.

Sources close to the talks said that GM is willing to strike a deal with RHJ right now based on its current offer, but Germany and the four states including Hesse have signaled that they would be more willing to grant billions of euros in state aid if GM picks Magna.

Unions heavily favor the Canadian auto parts supplier rather than the formerly little-known financial investor that traces its origins back to U.S. private equity firm Ripplewood.

As long as GM is in need of aid from Germany, Schaefer said the U.S. company would be well advised to strike a deal with Magna.

“I believe there are only a limited number of issues still open. If one were to sit down and concentrate on working them out, a solution could be found in 24 hours,” the Opel Task Force member said.

Reporting by Angelika Gruber and Christiaan Hetzner

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