Obama 'helped' Opel rescue deal ( Magna Wins )

BBC ^ | Saturday, 30 May 2009 15:05 UK 14:05 GMT, | BBC Staff

[Ernest_at_the_Beach]

German Chancellor Angela Merkel has revealed the US president helped swing a deal to save carmaker Opel from the imminent bankruptcy of its parent firm.

She said Barack Obama helped clear some hurdles threatening the transaction during a phone conversation.

Earlier, Germany agreed the deal with Magna International, a Canadian car parts maker, to take over Opel, part of the European wing of US carmaker GM.

It should protect Opel if GM files for bankruptcy protection in the US.

GM is expected to do this as early as Monday.

Marathon talks

"I spoke on the phone with the American president yesterday [Friday] and we were in agreement that we had to do everything possible to come up with a good results for this complicated task," Mrs Merkel told reporters in Berlin.

Tim Weber, BBC News website business editor The deal struck in Berlin will not be the end of the wrangling over Opel. Weeks of negotiations are ahead, which means prolonged uncertainty for Opel's and Vauxhall's workers, customers, dealers and suppliers. Some analysts believe the merger has at best a 30% chance of going through. As Germany put the most money on the table, it managed to negotiate that all four Opel factories in the country will survive. This leaves Opel's other European operations badly exposed. In the UK, it could mean the closure of one plant, probably Luton. In Belgium, Poland and Spain workers will also be fearful for their jobs.

[Ernest_at_the_Beach]

Sorry about the white space...thought I had it fixed.

[mowowie]

How much did this cost me?

[freekitty]

Uh, Obama, big bad America is not suppose to be meddling in other countries business.

[Rapscallion]

Americans should recoil from socialistic praise emanating from socialist germany and socialist france.

[TigersEye]

Sorry about the white space...thought I had it fixed.

You know darned well that much white space is going to look racist. Bill O'Reilly is going to be all over that.

[VOA]

Magna International, a Canadian car parts maker

It's a macarbe carnival.
Watching the dismemberment of a former great commercial force
in the USA that has committed suicide.

All I can think is that Rick Wagoner and a band of his fellow GM
Execs didn't have sufficient imagination to forsee the hideous
slow-motion dismemberment of the great empire they ruled over.
Even after thousands of news reports and business school theses
told them what to do to survive, maybe even thrive.

At this point, I just hope that Magna International is headquartered
in the sane part of Canada called Alberta.

(I'm not going to google that because I fear Magna International
is more likely an Ontario or a a Quebec located entity)

[VOA]

How much did this cost me?

Sad thing is this:
the final bill probably will not be determined until your grandchildren's
grandchildrens are around.

Here comes multi-generational poverty.
Not only for those who deserve compassionate support or the crafty
grifters that exploit the government entitlements or our legal system.
Rather, it will be multi-generational poverty for anyone without
the means to move to a more capitalistic place.
Like Mainland China.

[Ernest_at_the_Beach]

LOL!

[wolfpat]

Can I get a GT now?

[TigersEye]

It’s OK, E_at_the_B, we all know you didn’t mean it that way. ;^)

[Ernest_at_the_Beach]

More:

Stronach: man behind the auto parts giant Magna

*************************EXCERPT*********************

by charmaine noronha, Associated Press

Frank Stronach, the Canadian owner of auto parts maker Magna International Inc., once referred to himself as "king" at one of his shareholder meetings. He's now added another property to his business empire: General Motors Corp.'s Opel unit.

After the second round of high-level talks in Berlin in as many days, Germany's finance minister said Saturday that a plan was approved for Magna to move ahead with Opel's rescue.

The Magna-Opel deal comes as no surprise to those who have followed Stronach's career.

"Frank's looking to put a cap on his career, build Frank up, build his legacy up. Frank's an egomaniac, so whenever Magna does something, you have to wonder, what's in it for Frank," said Wayne Lilley, author of "Magna Cum Laude," an unauthorized biography of Stronach. "As someone who is always looking to expand his empire, this Opel deal falls right into place."

The German government and several state governments will provide a 1.5 euros billion ($2.1 billion) bridge loan for the deal, part of which will be available immediately. Parliamentary committees in two German states must still approve the financing. That is expected Sunday.

Under the agreement, Magna, Canada's largest auto parts maker, will take a 20 percent stake in Opel, and the Russian-owned Sberbank will take a 35 percent stake, giving their consortium a majority. GM will retain a 35 percent holding, while the remaining 10 percent will go to Opel employees.

Magna did not immediately respond to calls for comment.

Acquiring Opel is a major strategic move for Magna, which has been hurt by the troubles in the North American auto market, especially at its Detroit Three customers _ GM, Ford Motor Co. and Chrysler LLC _ which are closing plants and slicing vehicle output.

For Stronach, the acquisition of Opel is the biggest deal in his company's history and cements his legacy as one of Canada's most globally ambitious executives.

The deal provides Magna with a major vehicle-assembly capacity to cash in on the lucrative Russian car market, which could soon become the biggest in Europe.

The acquisition also takes Stronach back to his European roots.

[Ernest_at_the_Beach]

Thanks....I just thought the sidebar was interesting.....but didn’t quite do the right thing with HTML.

[Ernest_at_the_Beach]

See #12....

[okie01]

Isn't transferring assets in the face of imminent bankruptcy against the law?

How could a bankruptcy judge sign off on this?

[TigersEye]

One would expect a wise HTML editor to come to better
conclusions than ... uh, umm ... a Bronx HTML editor!?!

Anyway, I had no idea Opel was still a car company. I had a roommate in Boulder, in 1975, who owned an Opel Kadet. I think it was a ten year old car then. AFAIK it is the only Opel I have ever seen.

[okie01]

At this point, I just hope that Magna International is headquartered in the sane part of Canada called Alberta.

No such luck. Aurora, Ontario is home to Magna.

More interesting, however, is the identity of the Cheif Executive Officer and President:

Belinda Stronach, one-time M.P....at first, a Conservative, then, a Liberal -- after she crossed the aisle to avoid a parliamentary defeat for the Liberals and was rewarded with a cabinet portfolio. She is the daughter of Magna founder, Frank Stronach.

She is also rumored to be a Bill Clinton squeeze...

[parisa]

Get used to it. This is what “spreading the wealth” is all about. You can live/work/go about your business where ever you want but sure as hell you’ll pay up to keep the govt’s partners, the union workers, content as they build govt mandated crap in Detroit from now on.

[Ernest_at_the_Beach]

Using the keyword opel and reading thru a few of the posts,...it seems that a lot of the midsize and smaller GM vehicles are modifications of some good basic Opel designs...but the skin and nameplate make it appear otherwise.

How is this....I like it:

The Opel GT

Shades of the Saturn Sky.

[Leonardo DiCrapio]

“Isn’t transferring assets in the face of imminent bankruptcy against the law?

How could a bankruptcy judge sign off on this?”

I can’t speak to the legality of this particular transfer of assets, but is it legal for the United States Government to arbitrarily tell Bank of America to raise tens of Billions of dollars, which is one of the reasons that BofA sold off a major stake in a Chinese Bank.

Judging by how the Chrysler bankruptcy has gone so far, I wouldn’t be surprised to see this whole debacle signed off on even if the transfer is illegal. I’m hopeful that quick GM and/or Chrysler sale(s) are somehow circumvented, and the proposed dealers who have been told they need to close (for what purpose when they don’t cost GM and/or Chrysler anthing?) raise a big stink.