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Beijing Automotive Industry Holding Co. (BAIC) bids for GM’s Adam Opel GmbH, What about Magna, Sberbank & RHJ International?

By Amarendra Bhushan for CEOWORLD Magazine Updated:July 4, 2009

China-based Beijing Automotive Industry Holding Co. (BAIC) has submitted a last-minute bid for General Motors’ European Opel unit, Adam Opel GmbH (bid €660m ($923m) for a stake), now giving the U.S. carmaker an additional option as it continues to struggle through a deal with Magna International.

The deal with Austrian-Canadian parts maker Magna, which is in conjunction with a Russian bank, has hit several political obstacles in election-year Germany in addition to disputes over various intellectual property rights.

Under the terms of its proposal, Magna would get 20 percent of Opel, Russia’s state-controlled Sberbank would get a 35 percent stake, which it was expected to transfer to a Russian automaker, GM would retain 35 percent, and Opel employees would have 10 percent.

Although Magna is still considered the front-runner, Italy’s Fiat SpA and Brussels-based RHJ International SA also have expressed an interest in taking a stake in Opel.

State-controlled Beijing Automotive may have an advantage over Magna because it may need less financial support from the German government.

State-owned Beijing Automotive Industry Holding Co. (BAIC) is the holding company of Chinese automobile and machine manufacturer Beijing Automotive Import & Export Corporation, and founded around joint ventures with western automakers viz. Jeep and Daimler-Benz, producing over 700,000 vehicles annually.

RHJ International, a Brussels-based industrial holding linked to US buy-out group Ripplewood, has also made a non-binding offer.

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