The Austrian-Canadian car parts group Magna seems to have moved into pole position in the race to takeover Opel. It has been confirmed the ailing German carmaker’s parent company General Motors has reached an agreement in principle with Magna. They then moved on to working out the final details ahead of a meeting with Chancellor Angela Merkel.
The German government has to provide loans for any deal and has been scrambling to safeguard Opel’s future and avoid thousands of job losses in an election year. Magna - started by an Austrian emigre Frank Stronach in a Toronto garage nearly half a century ago - plans to use Opel to make a push into the Russian market.
The other main potential bidder, Italy’s Fiat, appears to be conceding defeat to Magna. In a statement, Fiat’s boss Sergio Marchionne said his company was not attending the talks at the German chancellery. He said his focus is on Fiat’s tie up with Chrysler adding: “If the Opel transaction is not available to Fiat, life will move on.”
For the Magna deal to work, US officials must abandon their opposition to German demands that Opel’s assets be temporarily placed in a trust to protect them from GM’s creditors. If they do so, Berlin is set to release one and a half billion euros in bridge financing to keep Opel operating until a merger is finalised.
Opel, which includes Vauxhall in Britain, has plants in Spain, Poland and Belgium as well as Germany.
Magna favourite to take over Opel