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Vauxhall/Opel sale in trouble
30 June 2009
GM's plans to sell a stake in Vauxhall and Opel to Magna International are stalling, with the Financial Times reporting that GM is on the brink of signing a new deal with Belgian private equity firm RHJ International.
RHJ was one of the original bidders for Vauxhall/Opel, but GM signed a memorandum of understanding to sell the company to Magna.
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However, RHJ is now understood to have increased its bid, and the FT is reporting that GM may sign a preliminary deal to sell it Vauxhall/Opel later this week. If that happens both RHJ's and Magna's negotiations could continue, with GM able to chose its preferred bidder.
China’s Beijing Automotive Industry Corp is also reported to be preparing an improved bid, raising the prospect that GM could have three potential offers to choose from.
Magna's bid is reported to have run into difficulty over access to GM's global technology. If the sale proceeds, Magna and Sberbank plan to build Opel-based cars in Russia with Gaz, but GM is said to be reluctant to allow this.
In addition, some GM figures feel Magna is using its political backing to press for unfair terms, while GM also wants the right to buy back some or all of the stake.
Mark Tisshaw
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