opel news



LONDON (Dow Jones)--General Motors Co. said Thursday it had made a decision on the future of German unit Adam Opel GmbH and its U.K. sister company Vauxhall, as people familiar with the matter told Dow Jones Newswires that GM's board had recommended a sale to a consortium led by Canadian car parts maker Magna International Inc. (MGA).

GM will disclose its decision at 1400 GMT at a press conference in Berlin.

A person familiar with the situation told Dow Jones News wires that GM's board is recommending a sale to Magna, which is backed by Russia's largest bank, OAO Sberbank (SBER.RS). Another person familiar with the matter confirmed that the board of General Motors has opted for an investor solution for its Opel and Vauxhall operations. He declined to be more specific.

The German government said it hadn't been told the decision, and a spokesman for British Prime Minister Gordon Brown declined to comment.

GM Chief Executive Fritz Henderson laid out four options to the board at a two-day meeting that concluded Wednesday: keeping Opel, liquidating the unit, or selling it to the Magna consortium or rival bidder Belgian investment firm RHJ International Inc. (RHJI.BT).

The board was to determine whether keeping Opel could be a better option than selling a majority stake in exchange for German loan guarantees.

The German government has supplied EUR1.5 billion ($2.16 billion) in bridge financing to help keep Opel afloat while a deal was being hammered out for the company. The financing, and any further aid, is considered contingent on whether GM decides to go with Magna, which is Germany's favored buyer.

German Finance Minister Peer Steinbrueck said Wednesday that GM would have to repay the aid the German government has provided to support Opel if GM decides to keep the unit.

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