Filed under:
Europe,
Government/Legal,
GM,
Opel
General Motors' bouleversement on the sale of its Opel brand has caused the
European head of Opel vacate his office, the head of Opel labor to gulp "a bottle of wine" to get over the shock, the German head of state to request "GM to present a reliable plan for Opel quickly," and Germany's economic minister to prod GM to pay back the rest of the €1.5 billion ($2.25B U.S.) bridge loan.
GM's response has been for CEO Fritz Henderson to Germany on an "
Opel charm tour," to pay back a portion of the borrowed fund and promise the remaining €600 million by the end of the month, and to declare that it will only need €3.5 billion ($4.5B U.S.) to restructure Opel. GM crows that the amount is "significantly lower than all bids submitted as part of the investor solicitation" and how, in fact, it's less than the €4.5 billion the German government pledged to give Magna in aid (much less Magna's anticipated restructuring costs).
The gap in this scenario: Where did GM get that number? It was rumored that Belgian investment bank RHJ was only looking to hold on to Opel for a turnaround sale to GM, which would seem to indicate they weren't going to spend a ton of money on restructuring, and even its final bid was more than €3.5 billion. Moody's predicts GM will actually need €5.8 billion ($8.5B USD) to turn Opel fully around. Nevertheless, some
see this as a good thing. For us, the only conclusion we can come to is the same one we've been held at for six months: a lot of questions still need answering.
[Source:
Automotive News, sub req'd | Source Image: Warner Bros.]
REPORT: Germany wants GM's plan for Opel - and a billion dollars - "quickly" originally appeared on
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12-11-2009, 10:20 PM
