Magna expect to take over Opel by September
 

Auto parts supplier Magna International Inc. hopes to complete by September a deal to take a majority stake in car maker Opel, Magna’s co-CEO said today.

Magna’s Siegfried Wolf visited Adam Opel GmbH’s headquarters days after hammering out an agreement with Opel parent General Motors Corp. and the German government to move forward with a rescue plan for the company.

“We should roll up our sleeves now and clear up the last open points,” Wolf said after an employee meeting. “Then I think we can very quickly come to a conclusion.”

Wolf said a contract could be signed in the next four or five weeks, but it is likely to be the end of September before all involved have given their final approval. “Time is very, very tight,” he said.

Opel on Tuesday received the first euro300 million ($425 million) installment of a euro1.5 billion ($2.1 billion) bridging loan granted by the government to keep the company afloat while work continues to conclude the takeover.

That arrangement, which saw Opel and British sister brand Vauxhall placed under a trustee, shielded the European operation from parent GM’s bankruptcy protection filing.

The preliminary agreement reached Saturday calls for Magna to take a 20 percent stake in Opel and for state-controlled Russian lender Sberbank to take a 35 percent stake, giving their consortium a majority.

GM will retain a 35 percent holding, while the remaining 10 percent will go to Opel employees.

Opel’s employee council chief, Klaus Franz, said the aim is for the Opel that emerges from the process to produce an annual 2 million vehicles within the next five years, an aim that he said could be reached if the company has a global footing and a presence in Asia.

Last year, Opel and Vauxhall combined produced 1.5 million vehicles.

Opel employs 25,000 people in Germany, nearly half of GM Europe’s work force.

German government officials have said Magna’s plan anticipates between 7,500 and 8,500 job cuts across Europe.

Franz said the employee council was standing by its demand that no plants be closed and that layoffs be avoided, but conceded that negotiations on factories in Bochum, Germany; Antwerp, Belgium; and Luton, England would be a “tough nut.”



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