Opel Suitors Asked to Improve Bids

It happens again and it will most likely happen in the future as well. Opel's suitors, now counting only two of them, are asked one more time to improve their bids in case they really want to buy the German brand. This is what German Economy Minister Karl-Theodor zu Guttenberg said on Sunday, hinting that both Magna International and RHJ have to submit revised bids for Opel.

"My concerns are well known," Guttenberg told German newspaper Bild am Sonntag on Sunday. "In the tri-lateral talks with GM, the investors as well as the federal and local German governments, it will be important to get further improvements that are in taxpayers' interest. One such improvement could be, for instance, an increase in the investors' capital contribution."

What's interesting is that both Magna and RHJ submitted improved bids two weeks ago and the Canadian - Austrian parts manufacturer said that was its latest offer for the German manufacturer. In case GM does not agree with its terms, Magna could leave negotiations, the company said at that time.

But opinions of the two bidders are still divided as Magna International is backed by Angela Merkel who says the Canadian group has the best takeover proposal for Opel. On the other hand, GM supports RHJ whose offer is easier to implement, as John Smith GM group vice president and GM’s chief negotiator for the sale of Opel said.

"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. This remains a reasonable and viable option to be considered as the very difficult issues around the Magna negotiations continue to be worked," he said.