German government renews backing for Magna - Sberbank Opel bid
German Chancellor, Angela Merkel, gave strong support for the Russian-Canadian bid for car maker Opel, when she hosted the Russian President in Munich, as the deal hangs in the balance.
The German government has said it will re-think its financial support for the Opel take-over if GM doesn't choose Magna. 6 weeks ago an agreement was signed with Canadian car parts manufacturer Magna and Russia's Sberbank.
Berlin has agreed to pay a 1.5 billion euro bridge loan to make that deal happen. But GM has reopened the bidding – striking non-binding agreements with Beijing Motors and RHJ of Belgium.
German Chancellor Angela Merkel said she hoped for a quick solution.
“The concept of Magna offers very attractive points in order to open up the Opel plans once again and we also hope that Russia will also play an important role within this project and I think that the investors Magna in Russia will also contribute to this development.”
Germany is likely to make a decision before the national elections in two months time. But experts such as Dr Frank Schauff, CEO of the Association of European Business in Russia, say the outcome is beyond their control, with the erstwhile parent – a GM emerging from bankruptcy – calling the shots.
“Certainly the last word regarding the deal will be made in Detroit. And it's up to GM, not the Russian government or German government.”
One of the biggest issues with Magna is intellectual property rights, with GM seeking royalties from Opel.