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GM's Opel Sale to Magna 'Further Along'

The Associated Press

FRANKFURT-- A GM Europe spokeswoman said Wednesday negotiations for the sale of General Motors' (GMGMQ) Opel to Canadian auto-parts maker Magna International (MGA) were "further along," while confirming it had received a bid from China's Beijing Automotive.

Maggie He, a spokeswoman for GM China in Shanghai told the Associated Press that the Chinese automaker had made a bid for Adam Opel GmbH, confirming weeks of speculation. No details about the BAIC bid were released and phone calls to the company weren't answered.

GM Europe spokeswoman Karin Kirchner in Zurich also confirmed GM was in talks with BAIC but added the company was "concentrating on negotiations with Magna for a binding contract."

GM has said its memorandum of understanding with Magna isn't exclusive and, thus, other companies could make bids.

A GM statement said that it "has received, and is discussing, proposals from RHJ International and Beijing Automotive Industry," even as its talks with Magna move forward.

RHJ International, also known as Ripplewood Holdings, is a Belgium-based industrial holding company.

Kirchner wouldn't comment when asked if there was any timeframe for concluding talks with Magna, or on details of the BAIC bid.

Over the weekend, Karl Peter Forster, the head of GM Europe, said he hoped the sale of Opel to Magna could be complete by mid-July, according to press reports.

Detroit-based GM, which filed for bankruptcy protection in June, is racing to remake itself as a smaller, leaner automaker in a broad restructuring which is slashing the company's units and brands.

GM's filing for bankruptcy protection was the largest ever for an industrial company. GM said it has $172.8 billion in debt and $82.3 billion in assets, and had received about $20 billion in low-interest loans before entering bankruptcy protection.

AP Business Writer Joe McDonald contributed to this report from Beijing.