General Motors board delays decision on favored Opel bidderTue, 04 Aug 2009 00:00:00 -0700
General Motors Co.'s new board of directors made no recommendation in favor of one of the two rival bidders for Opel, the company said on Tuesday.
The board has been updated on the Opel sale process but because talks are continuing with Magna International and Belgian investment company RHJ International, no recommendation has been made, GM said in a brief statement.
GM's new board of directors was expected to choose one of the two bidders at a meeting on Monday evening.
A decision on which bidder will buy a majority stake in Opel will take some time, a GM spokesman told Automotive News Europe on Tuesday.
German government officials and GM representatives are meeting the remaining two bidders for Opel on Tuesday afternoon.
Berlin, which is providing state aid to keep Opel running, is asking the bidders to invest more money than they have already promised into the German-based carmaker, according to German press reports.
GM is relinquishing control of Opel in return for German state support that Opel needed after GM filed for bankruptcy protection in June.
GM favors RHJ's offer, media reports have said. The German government and the four states that have Opel production plants strongly support Magna's offer.
German Economy Minister Karl-Theodor zu Guttenberg said in a weekend newspaper interview the two suitors must improve their bids to win government backing.
Magna wants to expand Opel's full-scale car assembly business and forecasts high growth rates, particularly in Russia, home of its bidding partner, state-controlled bank Sberbank.
RHJ aims to shrink production to return Opel to profit and may be open to selling it back to GM at a later date.
By Paul McVeigh- Automotive News