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 ...

After months of painstaking negotiations, GM has scrapped the Opel sale on the basis that it was 'no longer in the best interests of GM, now that the environment for car sales has started to improve', reports the Independent.  The decision comes just after Opel's labor force had agreed to contribute $390 million in annual savings.  'Management had planned a release saying that they will proceed with Magna, so there must have been a fundamental change of view within the board', the FT quotes an insider as saying.  The Russian government is planning to raise $1.87 billion to bail out ailing carmaker Avtovaz, most of which will be apparently allotted to bad debts, and some of which will be allocated to modernization and on job creation, Prime Minister Vladimir Putin has reportedly announced.  Daimler Trucks will proceed ...

Corporate truce: Norway's Telenor and Russian partner Alfa have settled their long-standing legal wranglings and decided to pool their Russian and Ukrainian assets into a New-York listed mobile operator.  The Moscow Times reports that Prime Minister Putin has asked Renault to throw a financial bone to struggling partner AvtoVAZ, 'or we will have to discuss our relative stakes'.  Russia may borrow between $2 and $4 million in 2010 from the World Bank.  Retail giant X5 is looking to buy local supermarket chain Paterson.  Nokia will not be fined for violating Russian competition laws; it remain unsure if the same can be said for Ikea.  Rumors that Opel may move its van production from England to Russia have English workers in an uproar; Magna has denied the reports.  Digital Sky Technologies is buying more shares ...

With so many changes afoot in Germany following the elections, there is surprising little discussion about how all this is going to affect relations with Russia.  There's a pretty good reason for that, as everyone assumes the likely appointment of Guido Westerwelle will pose little to no change from the former SPD-led Russia policy.  Such was the conclusion of this piece on Russia Profile by Graham Stack, who argues that "Russia policy is likely to remain pragmatic and constructive, including disavowing Ukraine and Georgia's bid to join NATO."  Stack's article was interesting in the amount of attention he gives to the lobbying muscle of Germany's energy corporations, such as E.ON.  So while the CDU victory may ...

An investment arm of Goldman Sachs Group Inc. (GS) is poised to invest about $250 million in Geely Automotive - China's largest privately-owned carmaker - by purchasing the company's convertible bonds and warrants.

Geely Automotive is the Hong Kong-listed arm of Chinese automaker Geely Holding. Goldman Sachs Capital Partners will buy convertible bonds and warrants issued by Geely's Hong Kong-listed subsidiary. The deal is almost complete, but some technical details of the investment are still pending. Confirmation of the deal could be announced as early as this week.

Geely plans to use the proceeds from the Goldman investment to boost its production capacity, which could free up capital for its parent to bid for Volvo. Geely's parent company has made global headlines in recent weeks after contemplating a bid for Volvo, the Swedish car brand owned by Ford Motor Co. (F). A successful deal would boost Geely's profile and

...

The Chief Financial Officer of VTB, Nikolai Tsekhomsky, has resigned. He will be replaced by Herbert Moos.  Microsoft claims that the Federal anti-monopoly service's probe into its activities, which has now closed, found no breach of ant-trust laws in regard to the Windows XP operating system.  The owner of Norilsk Nickel, Vladimir Potanin, has argued that the ruble must weaken to help Russia's exporters.  An article in Bloomberg suggests that the currency will fall 10% by March as the government fails to stem its deficit and continues to prioritize liquidity.  GM is unlikely to sell Opel to Magna because the carmaker is unwilling to give its intellectual property over to Russia, says the head of a pro-business group in Angela Merkel's party.  Mobile operator Megafon has posted a 4% increase in profit in the first six ...

After a second consecutive month of growth in July, when GDP increased by 0.5%, government ministers Igor Shuvalov and Andrei Klepach have felt optimistic enough to suggest Russia's recession may be over - 'but the crisis has yet to be overcome'.  Sberbanks's profits fell by 93% in the first seven months of the year.  The bank will provide Rushydro with up to 20 billion rubles to fund the rebuilding of the Sayano-Shushenskaya hydropower plant.  ITAR-TASS reports that mortgage loan interest rates may decrease to pre-recession levels in 2-3 years.  Opel unions will put pressure on GM to accept the Magna bid for the car maker's European unit, promising 'spectacular measures' to push a deal through.  Apparently joblessness continues to rise in 47 of Russia's regions.  Following a chorus of criticism joined by Oleg Deripaska, ...

General Motors advisers are apparently recommending that the company walk away from Magna's Merkel-backed bid to acquire Opel and instead seek out aid from other European governments to retain control of the unit itself.  'Every day counts for workers and for the economic situation' the German chancellor has said, asserting that a decision is needed 'urgently'.  Russia's direct foreign investment fell by the most on record, 45%, in the first six months of the year.  Steel-maker Mechel has said that it plans to place $316 million worth of bonds before 2009 is out.  The stock market has shown resistance to the threat of violence in the Caucasus, says Reuters, despite a Chechen separatist website declaring 'economic war' on Russia.  ITAR-TASS reports that a new anti-monopoly law will be put in place to prevent bureaucrats and businessmen ...

General Motors will choose a preferred bidder for a controlling stake in its European Opel/Vauxhall business today. The deal has become a race between two suitors, Canada-based auto parts supplier Magna International (MGA) and Brussels-based industrial investment group RHJ International.   GM sits uncomfortably in the deal amidst the German government’s bias towards Magna. This is because Magna has vowed to make most of its job cuts outside Germany if it wins the deal. Both the suitors had indicated they would cut Opel’s workforce by a fifth – about 10,000 jobs – to make the unit financially viable. GM is in a dilemma fearing that Magna, backed by Russia’s Sberbank, could capture Opel's technology for the Russian car industry. Thus, if Magna wins the deal, GM may lose Russia’s increasingly important market for its models such as Chevrolet. Magna and Sberbank are planning to manufacture Opel cars ...

German Chancellor Angela Merkel has reiterated her preference for Magna in its bid for Opel and described herself as 'very skeptical' about rival bidder RHJ International's prospects.  Finally some good news for ailing Lada-maker Avtovaz, which has smashed a German market growth record, with sales climbing 138% in the first half of 2009 compared with the same period last year.  Retail sales dropped the most in almost ten years in July, falling for the sixth month in a row.  Prime Minister Putin has said that the government will double its diamond industry bailout and set aside 30-35 billion rubles to buy diamonds to the state reserve this year.  The government has handed out between 1,500 and 2,000 microloans in an attempt to support small and midsize entrepreneurs.  The government is likely to return to nickel export tariffs at ...