Hold the horses! Stop the presses! Forget all about my previous comments about the GM-Opel-Magna-Sbersk deal because the deal is off. GM announced that it withdraws its prior agreement under which the Austro-Canadian conglomerate Magna would have purchased Opel from it. Even insiders are still wild guessing about the true motivation for hitting the brakes. Some say that it’s a matter of GM having emerged from bankruptcy flush with cash and therefore don’t need to get rid of Opel any more. Others suspect a tactical move behind this. What somehow puzzles me is a recent photo showing Russian oligarch Oleg Deripaska with Magna International chairman Wolf and GM CEO Henderson in the United States. Deripaska whose automotive company GAZ would have hugely benefitted from the deal has been denied US visas for several years and now has been brought in by special arrangement of the FBI. Word is also that Magna is not really sad about the deal being cancelled fears of jeopardizing good relationships with other customers among the automotive brands kept mounting. What’s interesting is that the GM made the announcement as German chancellor Angela Merkel was about to board a plane back to Germany after an important state visit to the United States. According to German media, this didn’t go down well with the German government which now may be looking into withdrawing commitments for subsidies to Opel.
Posts Tagged ‘Magna’
With the takeover of ailing GM subsidiary by the Austrian-Canadian conglomerate Magna still not being finali, dark clouds are gathering over Germany. Volkswagen-owned Porsche is said to rethink its contracts with Magna for the production of its prestige Boxster model starting in 2010. And also BMW is expressing concerns over its relationships with Magna. As Ferdinand Piech, Chairmen of Volkswagen’s supervisory board put it: “We don’t like it when our suppliers turn into our competitors”. I told you so!
After months of uncertainty and intensive negotiations, GM has announced this week that it will decide a 55 percent stake in it’s European Opel unit to a consortium of the Austrian-Canadian automotive supply conglomerate Magna and its Russian investment partner, Sberbank. 35 % of the shares will remain with GM, and another 10 % will be held by Opel’s employees. Magna’s majority shareholder, Frank Stronach, is coming full circle with this – he started a garage business in Toronto in 1957 manufacturing sun visor brackets for GM and then turned his company into one of the largest players in the automotive world. Having already experienced some difficulties in the Russian and Canadian markets, it’ll be interesting to see how Magna will be able to integrate so many different cultures under its wing – an Austrian-Canadian mothership, a Russian investor, an American shareholder and all of that in a German setting, competing on world markets. First, however, the parties to the agreement have to sign on the dotted line which is not expected to happen before German elections.