RHJ CEO says Opel sale not foregone conclusion

FRANKFURT (Reuters) – RHJ International still has good chances of winning the prolonged bidding process for Opel, the company’s head said.

RHJ CEO Leonhard Fischer said the outcome of the bidding process for Opel is not a foregone conclusion despite widespread backing for rival bidder Magna International.

Fischer’s comments were made in an interview with the German business newspaper Handelsblatt.

The German government, which is providing financial aid to keep Opel alive, is pushing Opel parent General Motors to sell a majority stake in the carmaker to Magna.

Fischer warned against jumping to hasty conclusions and added that it did not benefit the German government to “ban competition from the bidding process.”

“Predeterminations in preference of a specific investor only make the already complex sales negotiations more formidable,” he told Handelsblatt.

GM CEO Fritz Henderson and Magna Co-CEO Siegfried Wolf failed at a meeting on Friday to come to an agreement on Magna’s bid for Opel.

Fischer said talks were not necessary between GM and RHJ at the moment, as the two companies had already negotiated a basic contract.

German government officials and labor unions have expressed their preference for Magna and have prodded GM to work towards an agreement. They believe Opel has a better a long-term future under Magna’s Russian-backed consortium.

Magna wants to expand Opel’s full-scale car assembly business and forecasts high growth rates, especially in Russia.

GM’s chief negotiator John Smith has praised RHJ’s offer as simple and easy to implement, but Berlin rejected its first offer for Opel in May and the Belgium-based private equity firm has been unable to undermine widespread backing in Germany for Magna, even after dropping plans to close two German plants.

Smith said GM still has significant issues with Magna’s offer including Opel’s involvement with Chevrolet in Russia, intellectual property transfer rights in Russia, advanced technology access and product development responsibilities.

2 Responses to “RHJ CEO says Opel sale not foregone conclusion”

Leave a Reply