THE German government is reported to have offered a 4.5 billion euro loan to carmaker Opel if Canadian parts group Magna is chosen as its new owner.
An intense bidding war is going on for the European arm of General Motors, which includes Opel in Germany and Vauxhall in the UK, whose Ellesmere Port plant employs hundreds of people from Wrexham and Flintshire.
A number of news sources are reporting that the German government if offering the massive loan – worth £3.9 billion – if Magna’s bid is successful over that of its rival, Belgian-based venture capital group RHJ.
It is known that ministers in Berlin have always favoured the Magna offer, which gives greater safeguards to Opel factories in the country.
The final decision on which bid is successful is down to the trust which now runs GM Europe.
It has its next board meeting today.
Germany’s Deputy Economic Minister, Jochen Homann, is said to have revealed that the country’s federal government, and individual German states with Opel sites, would split the payment of the initial loan.
He is believed to have added that they would be prepared to do this without waiting for other European countries with GM factories – such as the UK and Belgium – to contribute their own loans.
Magna’s offer for Opel is backed by Russia’s Sberbank.
The German government is believed to have stipulated that Magna would have to pledge to invest 450m euros of its own money in Opel to get the 4.5bn euro loan.
Opel employs a total of 54,000 workers across Europe, with 25,000 based in Germany.
Vauxhall in the UK employs about 5,000 people at Ellesmere Port and Luton.
Manga has said that “no immediate plant closures are contemplated” in the UK should its bid be successful.
RHJ is also thought to have in mind keeping both Vauxhall factories, but may ask workers to take pay cuts.
Earlier this week, Wrexham MP Ian Lucas, who is now the Government Minister responsible for the car industry, told the Evening Leader he and his departmental boss, Lord Mandelson, were working hard to get the best possible deal for Vauxhall and its workers.