Opel dealers seek 10- to 15-per-cent stake in carmaker (2nd Roundup)

May 15, 2009, 16:12 GMT

Vienna - Opel dealers in Europe are offering to help the German-based carmaker by investing 500 million euros (679 million dollars) in return for a 10- to 15-per-cent stake in a reshaped business, the retailer association said Friday in Vienna.

In Berlin, sources said Chancellor Angela Merkel was taking charge of the crisis over General Motors Europe.

Potential investors have challenged the German government to carry multi-million-dollar losses in order to ward off politically embarrassing GM factory closures, whereas Berlin demands that the new owners bet their own money on the business risks.

Raising the stakes, German Economics Minister Karl-Theodor zu Guttenberg warned that GM Europe might declare insolvency if the front-running investors, Fiat and Magna, did not serve up an acceptable offer by Wednesday.

Media reports said the administration of US President Barack Obama has scorned Germany's plan to put Opel under temporary trusteeship of the state until an investor is found.

All 25 national members of the Euroda Opel retailers association - except for Finland - had approved the dealers' offer at a meeting in Austria's capital, the group's chairman Jaap Timmer told reporters.

'In return, we demand a fair equity share in the new company, representation in the supervisory board, and obviously, a fair financial return on our investment,' said Timmer, whose association also represents Vauxhall dealers.

The plan is to pay 150 euros for each sold car into an emergency fund over the coming three years to contribute to Opel's rescue, as 35,000 retail jobs are at risk in Germany alone.

Timmer said it would hurt retailers to pay into the fund, especially those in Central and Eastern Europe, 'but it would be far worse if we had no manufacturer at all.'

Euroda is now set to start talks with the players who would have to support the offer, including the government in Germany and other countries where Opel cars are made, as well as potential investors such as Italian carmaker Fiat or Canada-based car industry supplier Magna.

Timmer said that he had received positive signals from Opel, which is a subsidiary of close-to-bankrupt US automaker General Motors, and that the German government was informed.

For their part, the dealers would seek at least 10 per cent to be able to wield some influence on Opel's board, but could not afford more than 20 per cent, Euroda vice chairman Albert Still said, stressing that the rate was preliminary: 'We don't know the final price for a new Opel-Vauxhall firm.'

Euroda's leaders did not express any preference for either Fiat or Magna and its group of Russian investors, but said that Magna had indicated more interest so far.

The dealer's association was ready to present its proposal to the government in Berlin by May 20, as Fiat and Magna reportedly plan to do, Timmer said.

Zu Guttenberg announced Berlin's intention Thursday to fence off General Motors' assets in Germany and place them in a trust if the US parent fails.

Washington does not support the idea, the German dailies Financial Times Deutschland and Frankfurter Allgemeine Zeitung reported Friday.

An industry analyst in Germany, Ferdinand Dudenhoeffer, said it was completely unrealistic to expect GM to simply give away assets to the trustee, or creditors to surrender their legal claims if GM filed for insolvency.

He said it made more sense for Berlin to pay 3 billion to 4 billion euros for a large chunk of GM Europe.

A German government spokesman, Thomas Steg, declined comment, saying the matter was at a 'sensitive stage.'