Posted on 05/28/2009 1:53:41 PM PDT by Tailgunner Joe
One of the more bizarre elements of Magna International Inc.'s proposed bid for General Motors Corp.'s German unit Opel is that it would leave Opel jointly controlled by the U.S. and Russian governments in a two-pronged nationalization of the automaker.
Aurora, Ont.-based Magna, the world's third biggest auto parts maker and the only one that also builds complete vehicles, has pitched the German government a plan that would see Russian lender Sberbank take a 35% stake in Opel. GM would retain a 35% piece of its own while Magna would get 20% and Opel's unions would get 10%.
Chancellor Angela Merkel weighed the offer Wednesday and held talks in Berlin on Opel with bidders. Berlin is racing to separate Opel's assets from GM with the automaker's co-operation and shield them through a government-run trust before the Detroit car company files for bankruptcy protection by Monday as expected.
GM is selling stakes in Opel as it overhauls operations around the world. Opel employs 25,000 workers in Germany.
Because GM is now effectively controlled by the U.S. Treasury, Barack Obama's administration would hold that GM Opel stake under Magna's bid. And because Sberbank is majority owned by Russia's central bank, the government of President Dmitry Medvedev and Prime Minister Vladimir Putin would hold the other major piece.
Frank Stronach, Magna's founder and chairman, has met at least once in the past two years with Mr. Putin. The Magna boss and lieutenant Siegfried Wolf are trying to forge an industrial partnership with Russian political and business leaders that would allow the country to rebuild its auto sector while the parts maker boosts revenue. Magna's bid is seen as a way for Opel to grow by expanding its sales dramatically to Russia's burgeoning middle class.
The other suitors for Opel are Italian automaker Fiat SpA and buyout company RHJ International SA. The seriousness of a fourth potential investor, Beijing Automotive Industry Holding, was less clear. Fiat and Magna are considered the front runners. A German government official said Berlin may wait and hold more talks before naming a preferred bidder.
"This is not an issue of being afraid of dealing with the Russians. It's an issue of understanding what the Russian game plan is and [using this kind of partnership to open up the Russian market, which has been devoid of the kinds of legal guarantees companies need to invest there]," said Robert Amsterdam, an international lawyer who has been following the Opel saga.
Ms. Merkel is keen to protect as many jobs as possible in the run-up to a looming parliamentary election in four months time. Mr. Putin may be keen to use Russian money to bolster his government's approval ratings.
"There is not a lot of great Russian economic news," Mr. Amsterdam said. "In terms of a flag-waving kind of thing for Mr. Putin to have to take back to Moscow, this would be a very significant political deal for him."
I always wanted one. Guess I never knew it had problems.
No guts. Geared up 4 cylinder; couldn’t beat a Schwinn fatty out of the hole.
Actually, that’s what Opossum wants to drive! Maybe you’ll get you wish.
Russia had an auto sector? Who knew?
expanding its sales dramatically to Russia's burgeoning middle class
Translation: KGB apparatchiks
This is not an issue of being afraid of dealing with the Russians
You'd better be afraid. Hire a food taster, and get a geiger counter.
“Remember these? Good riddance.”
Good looking car, for its day.
I owned a different model of Opel, when I lived in Germany, and it served m well.
GM has owned Opel since 1929.
Notice the German government is avoiding ownership in the mess, of untangling the Detroit’s three messes?
I wonder how Sweden is handling Saab, and how the UK is handling Vauxhall?
“Actually, that?s what Opossum wants to drive!”
Actually, that’s what Opossum wants US to drive! He’ll keep his limotank because he is “more equal” than we are. Or is that what you meant?
I stand with your correction, sir. My brain out ran my fingers.
here’s hoping those Opal assembly line workers who used to plant bugs for us in limos they were making for Soviet diplomats have since retired...
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