Bidder for GM units to be named soon

Bidder for GM units to be named soon


“The German government is set to name a preferred bidder for General Motors’ cash-strapped European operations, paving the way for one of the biggest state-supported industrial bail-outs in the country’s history,” the Financial Times said. It noted that German chancellor Angela Merkel would meet top officials from the US, General Motors and the bidders for GM’s European units Opel and Vauxhall on Wednesday. The three bidders in the running are Italian carmaker Fiat, Canadian car parts group Magna and Belgium-based financial investor RHJ International, the report said.

State guarantees

The successful bidder would get access to 5-7 billion euros (£4.4 billion and £6.2 billion) in state guarantees. The German government also wants to strike a binding agreement with GM and the US Treasury on shielding Opel or Vauxhall from an insolvency filing of the US carmaker, it added.

This is a pre-condition for a 1.5-billion euros government-backed bridging loan that Opel needs until a final deal can be sealed, the FT said.

On Sunday, Merkel said Berlin had to act quickly to avoid Opel being dragged into a possible GM insolvency.

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