Berlin - Italian carmaker Fiat pulled out of key talks set
to take place in Berlin on Friday, leaving rival bidder Magna in the
driver's seat to take control of Germany's Opel.
A statement by Fiat released in Turin said it would not attend the
afternoon meeting called by Chancellor Angela Merkel with Opel's
cash-strapped US parent General Motors and representatives of the US
administration.
Fiat and the Canadian-based auto parts manufacturer Magna had been
due to take part in the talks, designed to hammer out a plan to
secure the future of Opel and GM's European operations in the event
of GM going into insolvency in the US.
An earlier marathon round of talks broke up early Thursday without
result after GM had unexpectedly announced the need for up to 350
million euros (483 million dollars) in extra financing to keep its
European operations afloat.
Explaining Fiat's decision to skip the talks, chief executive
Sergio Marchionne said the new demand by GM 'would force Fiat to
support Opel financially and leave it open to unnecessary and
irrational risks.'
Marchionne left open a return to the negotiating table at a later
stage. Magna was holding talks with GM representatives on Friday
morning about the new financial demand.
German Economics Minister Karl-Theodor zu Guttenberg has made it
clear that, unless the potential investors further improved their
bids, a possible Opel insolvency would remain on the table.
A government spokesman said Friday the talks might not begin as
planned at 1600 (1400 GMT) unless there are clear commitments from
the potential investors and the US.
Between them, the parties need to negotiate over the new shortfall
in bridging funds resulting from the revised figures GM presented
Wednesday.
Any final decision on Opel's future rests with GM and the
US government, but Germany hopes to salvage GM's European operations
through a proposed 1.5-billion euros bridging loan, administered by
an interim board of trustees.
GM has pledged to transfer Vauxhall and other European GM
subsidiaries to the Opel brand, based in Germany but owned by GM in
Detroit until a buyer is found.
Bidders also reportedly expect the government to pay more than 5
billion euros to clear Opel of pension and labour compensation
claims.
The European Commission warned the German government on Thursday
to heed EU law in its attempt to rescue Opel.
USA
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