General Motors executives were meeting German government officials in Berlin today (9 July) to update them on the various bids for Opel, Bloomberg News reported, citing people familiar with the matter.

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Opel and front-runner Magna International, Berlin’s preferred bidder, have set a 15 July deadline to finalise the talks.


But there have also been bids from China’s Beijing Automotive Industry and Brussels-based holding company RHJ International.


One of the stumbling blocks to Magna’s bid is a dispute over distribution of the Chevrolet brand in Russia and use of GM’s intellectual property rights beyond the terms of the original agreement, according to the Bloomberg sources.


Under the original agreement, Magna would get 20% of Opel, including Vauxhall in the UK. Magna’s Russian partner OAO Sberbank would receive 35% but has said that it would subsequently sell that stake. This is also causing concern to GM which is reported to have said that it wants to have influence over the eventual buyer of Sberbank’s share. GM would retain a 35% holding in Opel.

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Magna’s bid includes at least EUR500m (US$698 million) in investments in partnership with Sberbank. It has asked for EUR1.5bn in German government loans.


Beijing Automotive offered to pay EUR660m for a 51% stake of Opel, leaving GM with a 49% holding, according to a copy of the Chinese company’s proposal seen by Bloomberg News. Beijing Automotive’s bid would require EUR2.64bn in government loan guarantees.


Under its offer, 7,600 jobs across Europe would be eliminated, including about 3,000 at three German plants. Beijing Automotive wants to sell 485,000 Opel cars through 400 dealerships by 2015, the document showed.


The RHJ proposals would also give GM a larger, but undisclosed minority stake than the Magna deal.