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Not the final word in GM’s Magnum Opel
So German Chancellor Angela Merkel has got her way. After months of pressure from the German government, General Motors has finally caved in and agreed to sell a majority stake in Opel to Canadian car parts maker Magna and Russian backer Sberbank.
It isn’t all over yet — GM is still attaching conditions to the sale of a 55 percent stake in “new” Opel — but the timing of the announcement and the apparently good news for Opel’s 25,000 German employees will be music to Merkel’s ears with just over two weeks to go before a Sept 27. general election.
Merkel says she doesn’t think the GM board’s decision is a delaying tactic, which says a lot about the way the talks have been conducted. But while GM and its chief negotiator John Smith have led Berlin and the various bidders a merry dance, the reality is that the once great U.S. car giant doesn’t really have much of a negotiating position: Opel needs 3.3 billion euros in loan guarantees to keep going. Only Germany is willing to come up with that kind of money.
So for now at least, GM has little choice but to keep Berlin and Opel’s unions happy by opting for Magna rather than Belgium-based financial buyer RHJ International’s bid.
from Paul Taylor:
What is Juncker’s game?
What on earth is Jean-Claude Juncker up to? The veteran Luxembourg prime minister keeps dropping hints that he is fed up and wants to stand down as chairman of the Eurogroup of euro zone finance ministers, then pulling back.
The latest hint came when Juncker said during an election campaign meeting this week that he wants to hand the finance portfolio over to his presumed heir, Luc Frieden, after Sunday's general election in the Grand Duchy. Since he is a member of the 16-nation Eurogroup by dint of being finance minister, the immediate assumption was that Juncker would stand down as its long-term chairman, well before his third term expires at the end of 2010.
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The Wall
