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Business

Chinese auto maker BAIC makes last minute bid for Opel

Video by FRANCE 24

Text by NEWS WIRES

Latest update : 2009-07-07

As the deadline approaches to close a deal with Canadian auto parts maker to buy Opel, state-owned Beijing Automotive (BAIC) could have thrown a spanner in the works with a 922 million dollar offer for a majority stake in the European car maker.

AFP - Chinese auto maker BAIC, which is offering 922 million dollars for a majority stake in Opel, plans to build a plant in China and cut jobs in Europe if its bid succeeds, a report said Tuesday.
   
In a non-binding offer submitted last week for the German-based unit of General Motors, BAIC proposed to spend two billion dollars on what would become Opel's first factory in China, according to the Financial Times.
   
The plant would come online in 2012 and make Opel models specifically geared towards the China market. In addition, BAIC would use Opel's German plants to export to China, the London-based newspaper said.
   
The Chinese auto maker also planned to shut down General Motors' Antwerp plant in Belgium and cut Opel's workforce across Europe, the report said, citing unnamed sources close to the matter.
   
A German economic ministry spokesman said this week that BAIC had written to German officials regarding Opel, without elaborating.
   
But earlier German press reports said the Chinese firm had proposed to take a 51-percent stake in Opel for 660 million euros (921.5 million dollars) with state guarantees of 2.64 billion euros.
   
BAIC's offer could put pressure on negotiations already underway for Opel.
   
Canadian auto parts manufacturer Magna International, backed by Russian state lender Sberbank, is in advanced talks with the US car giant to take a combined 55 percent stake.
   
According to German reports Carl-Peter Forster, head of GM Europe, has said he hopes Opel will be bought by Magna by mid-July, adding that the Canadian firm had a "considerable lead" on other possible buyers.
   
An executive at BAIC's press office refused to comment when contacted by AFP on Tuesday.
   
 

Date created : 2009-07-07

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