GM U-Turn Startles
Source: http://www.robertamsterdam.com/2009/11/putin_on_opel.htmPosted on Wednesday, November 4th, 2009 | In Investing Lessons, Russia
It felt as if negotiations would go on for an eternity, with months of stalling: search this site for ‘Opel bid’ and the stories of stops and starts come thick and fast. Now, just as it seemed that the deal was finally coming to a close, comes the spectacular announcement that GM will not in fact sell off its loss-making European unit Opel to the consortium of Canadian part-maker Magna and Russia’s Sberbank, preferring to restructure it itself as the economic climate warms.
German Chancellor Angela Merkel, who had pledged €4.5bn in loans may well be fuming and apparently Prime Minister Putin has chimed in with his consternation over the abortive deal, which had promised to cement Russia-Germany business ties and heralded the overcoming of US Cold-War era fears about sharing technology with its old adversary. He has reportedly stated that a ‘deep legal analysis of the situation‘ will be undertaken. The Times reports:
Mr Putin’s spokesman said: “The decision by General Motors arouses surprise in Russia. According to our information the Magna-Sberbank consortium is intending to carry out discussions with General Motors very soon and carry out a deep legal analysis of the situation.” The Russian Government has repeatedly said that the sale of Opel to a Russian-backed group would show the readiness of US President Barack Obama to boost economic ties with Russia.
It is unclear whether GM will be forced to pay a break fee to the Magna/Sberbank consortium after terminating the deal.
Germany, which had been lobbying for Magna and Sberbank to buy the
operations to preserve 25,000 German jobs, today branded GM’s decision
as “totally unacceptable” and demanded details over the US carmaker’s
plans for the business.Christine Lieberknecht, the premier of Thuringia state, in which an Opel plant is based, called the decision a”low blow”.
Last 5 posts by Robert Amsterdam
- Who Helps Russia's Corrupt Get their Money Out? - November 23rd, 2009
- Sergei Magnitsky's Final Petition - November 23rd, 2009
- Energy Blast - Nov 23, 2009 - November 23rd, 2009
- Today in Russian Business - Nov 23, 2009 - November 23rd, 2009
- RA's Daily Russian News Blast - Nov 23, 2009 - November 23rd, 2009
Angela Merkel, Barack Obama, Chancellor, Christine Lieberknecht, EUR, General Motors, Germany, Investing Lessons, Magna, Magna-Sberbank, Opel plant, premier, president, Prime Minister, Putin, Russia, Russia, Russian Government, Sberbank, spokesman, United States
 About Robert Amsterdam (http://www.robertamsterdam.com/)
Robert Amsterdam is a lawyer and an advocate for rule of law. His blog was created to express views which may stimulate debate and discussion on topics of international interest. Robert believes that we live in a world of unchallenged impunity, and he views his blog as merely a small attempt to shine a light on issues he views as important in countries with which he is engaged. He make no apologies or pretense of objectivity - he is merely stating his opinions. |
No recommendations, either expressed or implied, are being made to buy, sell, hold or short any of the mentioned stocks. No legal, tax or accounting advice is expressed or implied. Always contact your attorney, CPA, or tax advisor before acting on any legal or tax issues. StraightStocks.com is not responsible for the content, products, or services of any of the advertisers on this site. StraightStocks.com receives compensation from advertisers on this blog. Services and products referred to herein are trademarks, registered trademarks, servicemarks, and/or registered servicemarks of their respective trademark or servicemark owners.