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Germany seeks better bids for Opel

Associated Press / May 25, 2009
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BERLIN - A battle over the future of troubled General Motors Corp.'s Opel unit is heating up as Germany prepares to decide which of three potential suitors it prefers to take over the automaker.

Germany's economy minister said in an interview published yesterday that all three bids have shortcomings and made clear that an Opel bankruptcy remains an option unless the bids are improved.

Meanwhile, with many German politicians preferring a bid from Canada's Magna International Inc. and Russia's Sberbank, the head of Italy's Fiat SpA offered new assurances that his plan would not mean drastic job cuts in Germany.

That came after Economy Minister Karl-Theodor zu Guttenberg said Saturday that Fiat had made adjustments to its offer, changing issues such as risk-sharing. He gave no details.

Senior German officials were expected to meet today to discuss the situation, following a meeting Friday hosted by Chancellor Angela Merkel. Guttenberg has said a "basic decision" on Opel's future should be made this week.

Germany likely would have to provide substantial loan guarantees to any new owner. Opel employs some 25,000 people in Germany, nearly half of GM Europe's total workforce.

"It is good that there is now a real bidding competition," said Foreign Minister Frank-Walter Steinmeier, who is also vice chancellor. "That is useful to Opel and its employees and contributes to limiting the risks for state help."