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And Then There Were Three: GM's Opel Gets Bidders

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2010 Opel Ampera

2010 Opel Ampera

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General Motors has three bidders interested in its European businesses Opel and Vauxhall. Among the bidders? Fiat Group, which is busy recrafting itself from also-ran in the European car sweepstakes to a global player that's starting to look a lot like the old General Motors.

For its part, GM is trying to hash out a restructuring plan in advance of a May 31 deadline set by the Obama administration. GM CEO Fritz Henderson has all but said GM will file Chapter 11 by the end of the month, as the task of cutting deals with the United Auto Workers, dealers, creditors and the U.S. government has turned herculean.

As it's preparing the groundwork for a court-ordered restructuring, GM's also auctioning off its big but non-core automotive assets. In past weeks, it's announced the closure of Pontiac, the projected sale of HUMMER by summer, and the shutdown or sale of Saturn and Saab--both of which have attracted bids of their own, from the likes of Roger Penske and, well, Fiat.

Today's report from the New York Times and other sources, says Fiat Group has tendered one of the bids for GM's Opel and Vauxhall units. The Fiat bid is a welcome one for GM, which is said to be willing to sell the units to Fiat in exchange for a 30-percent stake in the Italian automaker. However, German labor unions are balking at a deal, which likely would shut down some auto production in the country where Opel builds many of its vehicles.

Another bidder for Opel is Magna International. Long considered a bidder for Chrysler before Fiat entered the picture, Magna has charged into the picture with its expertise in contract manufacturing--and with the odd bedfellow of Russian automaker GAZ, backed by a Russian bank. Fiat's plan to shut down some German manufacturing has given the Magna bid a shot, says the Times.

The third bid--and least likely, given the U.S. government's experience with Chrysler and Cerberus--is private equity fund Ripplewood, which has been in the automotive rumor mill since it expressed interest in some of Ford's now-sold brands, including Jaguar, Land Rover and Aston Martin.

Caught in the middle: the German government, which is trying to float loans to GM to keep Opel alive if it enters a court proceeding, and at the same time trying not to offend its newly empowered neighbors to the south.

It can only get more confusing next week, as GM hits a Friday business-day deadline for proving it has a plan to survive outside of Chapter 11. Stay tuned to TheCarConnection.com for coverage all next week.

[Associated Press, New York Times]

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Comment (1)
  1. "Suicide"

    If GM sells Opel/Vuxhaul then it should just shut up shop. Where does Obama think the money and technology to build small cars will come from? Opel has both the technology, experience and volume GM needs to build small cars.
    This madness needs to be stopped. I have no problem with the SAAB decision (should have been made a decade ago) Hummer and even Pontiac (CAFE would have killed it as a sports car company) but Opel is core to any future viability of GM.
    The best option for GM and what they may be doing is to sell to Magna but keep some interest with a right to be the first to buy it back if Magna decides to sell it.
    Selling to FIAT is dumb for both groups. Fiat doesn't need another european brand that makes small cars, that is what it does. The new models Opel is selling or about to sell compete directly with Fiat products but are on different platforms so there is no synergy on parts so the same car company will be making similar products but off different platforms. that is just dumb. Maybe in 5 years time as new models are needed there could be savings but that is a long way off.
     
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