No deal on Opel as GM needs more cash – again
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What’s surprising: Talks for General Motors Corp’s Opel failed to yield a deal.
What’s not-so-surprising: GM needs cash. Again.
Talks that ran all through Wednesday night to sell Opel to one of four final bidders narrowed the race to two but failed in sealing a deal. German ministers, emerging in the early hours of Thursday morning after more than 12 hours of talks, blamed GM and the U.S. Treasury for the failure.
Why? Because GM, the ministers say, shocked participants by announcing it needed 300 million euros ($415 million) more in short-term cash from the German government to keep Opel operating.
Italian automaker Fiat and Canadian auto parts supplier Magna remain in the race to buy Opel. Belgian private equity firm RHJ International is out. China’s Beijing Automotive Industry Corp was not present at the meeting but the option for it to return with a more detailed offer remained open.
Meanwhile, GM, which has lost $82 billion in the past four years and has received $19.4 billion in government funding since the beginning of this year. It has also said it would likely need $7.6 billion from the U.S. Treasury after June 1. Buy GM cars or not, they sure are getting your money.
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Fiat and Magna are probably waiting for GM to go bankrupt in order to get a better deal afterwards. What really amazes me is how Fiat can afford to buy GM Europe, there is no cash and they have plenty of problems themselves. To me it looks more like the blind leading the lame, how can this ever become a viable cooperation.