General Motors expects the governments of Spain, UK and Poland to provide about EUR1bn (US$1.4bn) in aid to help restructure Opel-Vauxhall operations, a person familiar with the matter has told Dow Jones.
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GM is also said to be willing to put some of its own money into restructuring Opel. The German government has already provided a loan to keep the European operations afloat and offered to fund a sale of a majority stake in the division to a group led by parts maker and contract assembler Magna International.
GM would prefer to sell an Opel majority stake to private equity firm RHJ International but the German government has so far not supported such a deal. GM’s board is scheduled to discuss Opel next week. Chief executive Fritz Henderson plans to brief individual directors on Opel before the meeting, Dow Jones was told.
Last month Henderson proposed accepting Magna’s offer for Opel, but the board told him and his management team it wanted to consider alternatives such as a deal with RHJ. Other options include GM keeping Opel, or having the unit file for insolvency.
The German government reiterated on Wednesday its preference for a sale to Magna. The Canadian-Austrian parts supplier is backed by Russian bank OAO Sberbank and Russian automaker, OAO GAZ.
Although most of Opel’s operations are located in Germany, it also has plants in Spain, Britain and Poland. There is concern in these countries that a restructuring financed primarily by Germany would focus on saving German jobs at the expense of those elsewhere in Europe.
