top-nav-left top-nav-right

Article Search


GM to sell Opel


General Motors has offloaded European car maker Opel to Canada's Magna International

Auto parts maker Magna received funding help from Russian bank Sberbank.

GM will see a 55-per cent stake in Opel transferred to the Canadian-Russian team but will keep 35 per cent for itself, with 10 per cent held by the workers.

Opel had been placed in a trust with Germany holding 65 per cent and GM 35 per cent to keep it from being drawn into GM's restructuring under bankruptcy protection in the US.

The deal still depends on conditions that could take time to work out, with chief GM negotiator John Smith indicating the Opel plant in Antwerp, Belgium, could be wound down.

German government supported the bid by Magna and the Russian state-backed lender, giving $2.2 billion in bridge financing to keep Opel afloat and offering billions more in credit to complete the deal.

Opel European operations, which include Opel, Vauxhall and Saab, posted an operating loss of about US$2 billion in the first quarter of 2009 and a total of nearly US$3.7 billion for the years 2006-2008. Analysts say most of the losses can be attributed to Opel and Vauxhall.

GM had sought to unload Opel since it ran into severe financial trouble late last year, seeking state help in November 2008.

Auto Trader New Zealand