Blog: Opel-Magna not quite yet a done deal
Dave Leggett | 18 October 2009
The Opel-Magna deal seems tantalisingly close to being done, but until it is actually inked the uncertainties remain. The position of the EU on state aid for Opel from Germany's government is the latest spanner in the works.
The EU Commissioner for Competition Neelie Kroes has written to Germany's Economics Minister Karl Theodor zu Guttenberg expressing her concerns that there are 'significant indications' that aid promised by German government to New Opel was subject to the pre-condition that Magna/Sberbank was selected to acquire a majority of the shares in New Opel. That's against the rules.
The EU involvement appears to raise the possibility that the bidding process may have to be opened up again. While some journalists may feel almost suicidal at such a prospect, there are more serious concerns over what the implications might be for Opel/Vauxhall's cash-flow position if the deal is significantly delayed.
Would some people at GM still prefer not to sell to Magna? Quite possibly and maybe the EU's latest involvement plays into their hands.
Done deal? Not quite. It may well be that after a few phone calls and clarifications over German government financing and the bidding process, it all duly goes through this week. But you wouldn't want to place a bet on that would you?
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