General Motors (GM) could finalize the sale of its German auto unit Opel as early as this week, the US automaker’s CEO Fritz Henderson said yesterday.
Henderson, visiting China for the first time since GM was restructured last summer, was also upbeat about the prospects for the sale of the company’s Hummer unit to Chinese buyer Sichuan Tengzhong Heavy Industrial Machinery Corp (四川騰中重工機械), which is still awaiting Chinese government approval.
Despite labor union objections over possible job losses, the sale of GM’s Opel and Vauxhall units to Canadian autoparts supplier Magna International Inc, which along with Russia’s state-owned Sberbank acquired a 65 percent stake in the German-based Opel from GM last month, is expected to go ahead, Henderson told reporters.
PHOTO: AFP
“It’s quite possible that you’ll see documents signed this week,” he said.
Though remaining issues are being worked out at the government level, Henderson said for the new arrangement to succeed the business would have to be restructured.
“We’re 35 percent of the business and we want it to succeed. In order to be successful we need to take a significant amount of cost out of the business,” he said.
GM, which spent 40 days in bankruptcy protection during the summer and has received about US$50 billion in US government aid, also plans to sell its SAAB brand and scrap Pontiac and Saturn as it tries to streamline its operations.
GM signed a much-anticipated deal to sell its off-road vehicle unit Hummer to Sichuan Tengzhong on Friday.
The deal gives Sichuan Tengzhong an 80 percent stake in the company, while Hong Kong investor Suolang Duoji, who indirectly owns a big stake in Tengzhong through an investment company, will get 20 percent.
The investors will also get Hummer’s nationwide dealer network.
Henderson would not comment on the sale price, said by a person close to the deal to be around US$150 million — much lower than the US$500 million it was valued at in GM’s bankruptcy filing — apart from saying the company was “satisfied.”
Henderson denied reports that while in China he would meet authorities to push for the deal’s approval, saying that while GM would support Sichuan Tengzhong it was up to the Chinese buyer to win government approval.
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