Opel’s future may include bankruptcy

A person familiar with General Motors Co.’s talks on Opel said Wednesday that the company’s board of directors is reviewing four outcomes as it debates the future of its German-based unit, including the possibility of keeping Opel or letting it slide into bankruptcy protection.

FRANKFURT, Germany — A person familiar with General Motors Co.’s talks on Opel said Wednesday that the company’s board of directors is reviewing four outcomes as it debates the future of its German-based unit, including the possibility of keeping Opel or letting it slide into bankruptcy protection.

The 13-member board, meeting in Detroit on Wednesday, is also discussing whether it should accept bids from a consortium of Magna International Inc. (TSX:MG.A) and Russia’s Sberbank or a competing offer from RHJ International, a Brussels-based investment house, the person told The Associated Press.

A recommendation, which would have to be approved by the trust overseeing Opel, could come with a formal announcement today.

Ruesselsheim-based Adam Opel GmbH, whose brands also include Britain’s Vauxhall, was transferred to a government-backed trust just ahead of parent GM’s bankruptcy. The trust holds 65 per cent of Opel, with GM holding 35 per cent.

Presumably, GM could also wait to make a decision on the fate of Opel at a later date, though that seems increasingly unlikely.

GM for months has stated its preference for the RHJ bid because the Brussels-based private equity firm is more likely to restructure Opel while preventing GM’s car designs and other technology from going to companies that compete against GM’s Chevrolet brand in Russia and other parts of the world.

But the German government has supported the Magna-Sberbank bid because they think it would preserve the most jobs in an election year. State-owned Sberbank has ties to Russian automaker GAZ, and GM is worried the Russian automaker could use Opel technology to compete with Chevrolet, which has grown in Russia.

If the board goes with RHJ or decides to keep Opel, it would be setting up a confrontation with the German government, which has offered C4.5 billion ($6.5 billion) in credit to support the Magna bid and wants to show it is preserving jobs before the Sept. 27 election.

Just Posted

Chemical analysis may provide clues to cause of huge Red Deer industrial fire

Fire on April 17 caused $9 million in damage to oil and gas industrial building

New loonie reason to celebrate and educate: central Alberta LGBTQ community

The new LGBTQ2 loonie is a conversation starter and a reason to… Continue reading

C & E Trail property owner wants to use land as RV storage yard

Red Deer city council gives initial approval

Indigenous cultural centre needed in Red Deer

Urban Aboriginal Voices Society hosts annual community gathering

Red Deer youth recognized for his compassion

Blackfalds man dies after vehicle collision

MISSING: Joshua Arthur Sanford

37-year-old Ponoka man last seen on Tuesday morning

Inspired by a galaxy far, far away, these ‘Star Wars’ mementos could be yours forever

CHICAGO —The stuff of “Star Wars” —and there is unfortunately no better… Continue reading

Shoppers Drug Mart launches second online medical pot portal in Alberta

TORONTO — Medical cannabis users in Alberta can now get their therapeutic… Continue reading

Taylor Drive honours legacy of outstanding community volunteer

The main roadway going north and south on the west side of… Continue reading

Oh, yes! Nurse, Raptors look to finish series with Magic

DENVER — In response to an early call, Toronto coach Nick Nurse… Continue reading

Delay of game calls, goalie interference top worst rules for NHLers: survey

The pace and excitement of 3-on-3 overtime isn’t just a thrill for… Continue reading

Avengers get epic send-off at ‘Endgame’ world premiere

LOS ANGELES — There were more than a few sniffles from the… Continue reading

Writers’ Trust launches program pairing rising writers with established mentors

TORONTO — The Writers’ Trust has launched a program that gives five… Continue reading

Most Read