Black Friday Sale! Save huge on InvestingProGet up to 60% off

Magna delays meeting on Opel to July 14 -source

Published 07/06/2009, 11:12 AM
Updated 07/06/2009, 11:18 AM

FRANKFURT, July 6 (Reuters) - Canadian auto parts supplier Magna has delayed to July 14 a board meeting where it was to approve its takeover of carmaker Opel from bankrupt U.S. parent General Motors, a source with knowledge of the matter said on Monday.

Magna's board, which includes founder and Chairman Frank Stronach, had planned to approve Co-Chief Executive Siegfried Wolf's business plan for a takeover of a 55 percent stake in Opel together with Kremlin-backed lender Sberbank.

General Motors would keep 35 percent.

"The date of July 7 was an option and not entirely fixed," the person said.

Reuters had reported last week that two sources with knowledge of the talks had said the board meeting was planned for July 7.

Magna had no comment.

GM Europe President Carl-Peter Forster told a Sunday newspaper that Magna had a "considerable" advantage over rival suitors for Opel since the two sides only had to clarify details, adding he was "extremely confident" that far-reaching agreement had been reached.

The delay gives rival bidder Beijing Automotive (BAIC) more time to convince GM and the German state and federal governments that its non-binding offer is at least as competitive as frontrunner Magna's.

A source familiar with BAIC's bid said the Chinese automaker was offering to inject 660 million euros ($923 million) in equity for a 51 percent stake in Opel, after conducting due diligence. GM would hold the remaining 49 percent stake under the bid.

While BAIC would only ask for 2.64 billion euros in government loan guarantees, compared with 3 billion for Magna, it has backed away from its initial guarantee not to cut any German jobs for the first two years after a takeover, the source said. (Reporting by Christiaan Hetzner, editing by Will Waterman)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.