Opel deal could be completed before the end of this week

Article by Christian Andrei, on August 26, 2010

GM, the parent company of Vauxhall and Opel, will soon decide, together with the German Government, with whom they will close up the deal for selling both brands. The best offers came from Magna International and RHJ Investments , both of them being in the final battle for the contract.

If to win the deal, Magna plans an investment 350 million Euros in Opel needing 4.5 billion Euros in state financial guarantees, while RHJ claims to invest 275 million Euros needing less financial aid than Magna, 3.8 billion Euros.

The business plans are also quite different, as Magna plans for a huge development of Opel's full-scale assembly business, aiming especially the Russian market for a high growth.

On the other hand, RHJ could have only a medium term plan of business that includes returning Opel to profit first and maybe later, when the value of the brand will be considerably higher, takes in consideration the possibility to sell it back to GM.

There is still a problem to settle between making the decision, as GM and Germany are arguing at the moment for whom to take over the two brands.

It seems that the government prefers Magna while GM is more interested in RHJ's offer. By the end of the week the deal should any way come to a conclusion and we'll let you know which bidder won the battle.

Topics: opel, germany

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