Germany: GM Must Make A Move On Opel

Economy minister said car parts maker Magna International has a 'rough concept' for its possible investment in Opel, but the next move hinges on General Motors.

BERLIN (AP) -- Germany's economy minister said Tuesday that Canadian car parts maker Magna International Inc. has drawn up a "rough concept" for its possible investment in Germany's Adam Opel GmbH, but the next move hinges on Opel's U.S. parent company, General Motors Corp.

"Magna presented me with an interesting first, rough concept for a commitment with Opel," Economy Minister Karl-Theodor zu Guttenberg told reporters after meeting with Magna officials.

Magna, along with Italian carmaker Fiat SpA, have expressed an interest in taking a stake in Opel. GM has been trying to find investors for its non-core and nonprofitable assets as part of a restructuring in which it has sought billions of dollars in aid from the U.S. government to avert its collapse.

Opel has said it needs euro3.3 billion ($4.3 billion) to get through the economic crisis, while the German government has said it doesn't foresee giving direct state aid. Chancellor Angela Merkel has suggested the government could help an Opel investor with loan guarantees.

Guttenberg stressed, however, that any further progress on the matter is contingent on GM providing further information.

On Monday GM announced a last-ditch measures to cut costs, stave off bankruptcy and meet stringent requirements for an additional $11.6 billion in government aid.

Guttenberg said the German government would wait to determine its role in any full or partial Opel sale after the U.S. government had also weighed in.

Aurora, Ontario-based Magna is one of the world's largest auto parts suppliers and has 74,000 employees. Opel labor representatives, along with several governors of German states where factories are based have said they favor a deal with Magna over one with Fiat because the companies aren't competitors and their products don't overlap.

German government officials confirmed last week talks were going on between Opel and Fiat as well as with Magna.

Fiat is also pursuing an alliance in American carmaker Chrysler.

GM CEO Fritz Henderson has said he is in talks with potential parties over Opel's future and a decision could come at the end of May.

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