Magna set to bag Opel as Fiat skips talks

30 May 2009

Although no official announcement has yet come out, analysts believe that the consortium led by Canada's Magna International and Sberbank of Russia will eventually become the new owner with shareholding of 55 per cent in the troubled German brand Opel by the end of the day.

Magana's road to victory become smooth after Italy's Fiat SpA, the only other bidder who was left in the fray after Belgium's RHJ International withdrew from the race on Wednesday, said it would skip crucial talks. (See: Fiat pulls out of Opel talks over funding demands, asserts not withdrawing bid ).

''The global reordering of the auto industry took a big step forward on Friday as an unlikely alliance led by Magna International, a Canadian auto parts maker, and Sberbank of Russia tentatively agreed to buy the European operations of General Motors,'' The New York Times reported on Saturday.

Under the terms of the deal, GM would retain a 35 per cent stake in the new company, with Sberbank, a bank controlled by the Russian government, taking 35 per cent, Magna holding 20 per cent and Opel's employees controlling the remaining 10 per cent.

Based in Ontario, Magna is a Canadian car parts and assembly group that makes vehicles under contract for major carmakers, including Chrysler, Mercedes-Benz, and BMW.

Magna plans to inject between 500 million and 700 million euros into Opel.