Someones Feeling Lucky On Opel – US-FOREX.US
As Adam Opel, the struggling European arm of General Motors, runs out of time and options to find a buyer, it emerged on Monday that the investment fund RHJ International was aggressively seeking a deal to buy the firm.RHJ International has pledged to keep all of Opel’s German plants open and said it would also rely on less state funding than other bidders like Magna International
, whose tentative takeover deal for Opel has recently faltered over intellectual property concerns.Talks between Magna and GM were hindered by Magna’s demands to control distribution of GM’s Chevrolet brand in Russia and to use the GM’s intellectual property for uses that were not part of the original deal.Opel’s management and unions have been increasingly concerned that the deal with Magna has now been delayed for weeks. The company’s future has meanwhile become a hot political topic ahead of German elections in September, particularly given the dramatic deterioration of the labor market in Germany. RHJ’s intention to keep Opel’s German plants open would thus sit well with the German government. Chinese bidder Beijing Automotive Industries wants to halt production at Opel’s plant in Eisenach, Germany for two years, but unions fear this would effectively ruin productivity at the plant long term. RHJ International, an investment company based in Belgium, says General Motors’
European operations, which also include Vauxhall in the U.K., would “comfortably” fit its long-term investment strategy.
RHJ has managed three car-parts makers since March 2005, when it was publicly listed. The investments are Japan’s Asahi Tec and Niles and Germany’s Honsel, although RHJ admits that none are profitable. It dismissed the idea that this discredits its case to buy GM Europe: “There is not a single automotive company that earns money,” said said Arnaud Denis, an RHJ International spokesman in Belgium. “The automotive industry has gone through some turmoil but we have continued to support these companies.” Denis would not confirm reports that RHJ would cut 10,000 jobs at Opel and Vauxhall if it took over GM Europe, and he would not give a timeline for the negotiation process. “We are not in the driving seat… We are patient and can afford to wait.”