European Union and German officials said they’re working to avoid a dispute over 4.5 billion euros ($6.9 billion) in state aid backing General Motors Co.’s sale of its Adam Opel GmbH division to Magna International Inc..
EU regulators want to ensure that any government help for Opel’s disposal meets competition rules before a transaction takes place so they can prevent a long probe later, Industry Commissioner Guenter Verheugen said yesterday. German Economy Minister Karl Theodor zu Guttenberg said on Oct. 17 that he aims to provide “the right answers” to EU concerns that the aid may have influenced GM’s choice of Opel’s buyer.
GM is close to completing a contract to sell a 55 percent stake in Ruesselsheim, Germany-based Opel to Magna, Canada’s largest auto-parts maker, and Russian partner OAO Sberbank, three people familiar with the situation said on Oct. 15. Opel, surviving on 1.5 billion euros in German loans, may run out of cash in January, according to government and company officials.
“It’s definitely in everybody’s interest to get this sorted quickly,” Michael Schuette, a Brussels-based lawyer specializing in state-aid cases, said in a phone interview yesterday. “This is not something you want hanging around.”
Germany chose Magna as its preferred bidder for Opel in May. Detroit-based GM agreed to sell Opel to Magna in September after considering offers from RHJ International SA and Beijing Automotive Industry Holding Co. Fiat SpA, Italy’s biggest manufacturer, provided a non-cash offer in May that it declined to improve on.