GM Sources Admit Magna Picked Following Political Pressure

Magna is getting farther when it comes to buying Opel as every single media report that comes out reveals a new hidden fact that could block the deal from getting closed. This time, the daily Financial Times Deutschland reported, citing GM sources, that the US-based manufacturer would not deny that it picked Magna as the new Opel owner following political pressure. In other words, General Motors agreed with Magna's offer after the German government pushed for it.

According to just-auto.com, the European Commission asked General Motors to clarify the matter in order to decide whether the German government loan for Magna must be approved or not. A final decision is to be made on November 27.

It's no secret that Germany supported Magna, detrimental to RHJ, the Belgium suitor who also submitted a takeover proposal for Opel. Germany's Angela Merkel even publicly expressed her support for the Canadian Austrian partsmaker and said she could even intervene in the talks to back Magna.

"There are still a number of questions to be cleared up. But the Magna concept offers excellent starting points," said Merkel at a joint news conference with Russian President Dmitry Medvedev. "It offers Opel a chance and also creates the possibility of establishing a strategic partnership in the car sector with Russia."

On the other hand, General Motors repeatedly showed its support for RHJ whose offer was believed to be easier to implement and more advantageous for the German brand.

"The bid from RHJI is completed and would represent a much simpler structure and would be easier to implement. It would require less monetary participation by the government and would keep our global alignments solid, while still creating an independent Opel/Vauxhall organization in Germany," John Smith, GM group vice president, explained in a statement.