8.25GM may mortgage China assets to keep Opel

GM may mortgage China assets to keep Opel

 

http://autonews.gasgoo.com/auto-news/1011895/GM-may-mortage-China-assets-to-
keep-Opel.html

 

Shanghai, August 25 (Gasgoo.com) General Motors Co is considering a plan to
retain its Opel and Vauxhall operations in Europe and may mortgage its
assets in China to raise money, Reuters reports Tuesday, citing sources with
knowledge of the deliberations. 

 

The development follows a meeting last Friday in which GM directors declined
to endorse a sale of Opel to Magna, sending the automaker back into
negotiations this week with the German government. 

 

Sources said while GM remains focused now on trying to clear remaining
issues with the Magna deal, executives also are considering other options,
including raising more than $4 billion in a bid to keep Opel. 

 

Because GM is barred from using funding from the U.S. government to support
its international operations, it may have to raise money by selling or
mortgaging its assets in China, according to the sources. 

 

The German government had promised to help finance that Opel's sale to Magna
but GM earlier leaned toward a bid for Opel/Vauxhall from RHJ International
SA, a Belgian private-equity group. 

 

The change in plans by GM presents a potentially difficult diplomatic
situation for the Obama administration as Germany and Russia, both key
trading partners of the US, want the Magna deal to go through. 

 

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