Many expected that the contract to sell a 55% stake in General Motors' Opel segment to Magna International would be signed this week; however, it was put on hold in order that GM's board of directors would be able to meet and decide some important points.
John Smith, GM's chief negotiator on the deal said that no sale can proceed until the board is able to discuss the Opel deal at its next regular monthly meeting on Nov. 3.
In a blog, Smith said that due to the significance of the Opel transaction, the board will be talking about Minister zu Guttenberg's letter and changes to the Magna/Sberbank proposal that have occurred since its last review on September 9.
If you recall, German Economy Minister Karl-Theodor zu Guttenberg had asked that GM confirm its reasons for choosing Magna.
This came about due to concerns from the European Union regarding promises of German state aid.
Smith said that while they wait for the board meeting to transpire, GM would work to resolve remaining open points with the Magna/Sberbank proposal that includes labor cost reductions and a plan to obtain 4.5 billion euros ($6.8 billion) in aid sought from states with Opel plants. [via reuters]