2nd UPDATE: Volkswagen Sees Conflict Of Interest At Magna
June 03 2009 - 8:06AM
Dow Jones News
Volkswagen AG (VOW.XE) said Wednesday Canadian auto parts
supplier Magna International Inc. (MGA) will face conflicts of
interest following the planned takeover of General Motors Corp.'s
(GM) Adam Opel GmbH unit.
"Volkswagen will monitor this development very closely,"
spokesman Michael Brendel said.
Volkswagen, Europe's largest automaker by sales, is a direct
rival of Opel.
"Tax money has been used to a large extent for Opel's rescue. We
hope that through this a sustainable and successful result will be
achieved effectively," Brendel said.
Magna wasn't available for comment.
Volkswagen, with its core VW, Audi, Skoda, Seat, Bugatti and
Lamborghini brands is a major customer for Magna. Magna also
supplies components to Porsche Automobil Holding SE (PAH3.XE),
Volkswagen's largest shareholder.
Last week, the German government together with the German states
where Opel plants are located decided to support Magna's bid for
the Ruesselsheim-based automaker through bridge financing of EUR1.5
billion and keep it out of the bankruptcy filing of parent GM in
the U.S.
Magna has teamed-up with Russia's OAO Sberbank (SBER.RS) and OAO
GAZ Group (GAZA.RS) to take over Opel and boost its presence in
Russia.
Magna Co-Chief Executive Siegfried Wolf said earlier Wednesday
during a press briefing at Opel's headquarters he expects to sign
off on a deal in four to five weeks, with the consortium's Opel
entry to be completed by September.
Magna's consortium plans an initial investment around EUR700
million. In terms of the plan, GM would retain a 35% stake in the
company. Sberbank would take a 35% stake as well, with Magna
holding 20% and Opel's employees with 10%.
Magna chairman Frank Stronach had said Tuesday that he expects
Opel to be profitable again in four years and plans to export cars
to Canada from end-2009 onwards, AFP reported earlier Tuesday.
However, there are currently no plans to export Opel cars to the
U.S., he said.
Company Web site: www.volkswagen.com
-By Christoph Rauwald, Dow Jones Newswires; +49 69 29 725 512;
christoph.rauwald@dowjones.com
(Nico Schmidt contributed to this article.)