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September 3, 2009

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Home » Business » Auto

RHJ beefs up offer for GM's Opel unit

RHJ International SA said yesterday it has improved its offer for General Motors Co's Opel unit, saying it would put more cash into the auto maker and seek lower loan guarantees from Germany's government.

Arnaud Denis, a spokesman for the Brussels-based company, told The Associated Press that RHJ would provide 300 million euros (US$429.4 million) in cash compared to 275 million euros offered earlier and expects loan guarantees of 3.2 billion euros from the government, down from 3.8 billion euros.

"We are still in the race," Denis said of the ongoing process to resolve the future of Adam Opel GmbH, whose fate has been debated during nearly six months of sometimes intensive talks. Under the new offer, RHJ would pay back the state loans by 2013 instead of 2014.

RHJ is bidding for control of Opel, although the German government has repeatedly said it favors a bid from Canadian car parts maker Magna International Inc and Russian state-owned bank Sberbank, which have promised not to close any of the four Opel plants in Germany.

Denis said RHJ's new offer was "the best and most compelling" but added, ultimately, "it's now up to GM to decide."

Last month GM's board declined to choose between Magna's and RHJ's original bids, raising speculation that it might not want to sell the unit at all for fear that technology could fall into competitors' hands and GM could lose valuable engineering resources.

Opel builds popular models like the Insignia sedan, which was voted the 2009 European Car of the Year by a panel of automotive experts.

The GM board is due to meet again on September 8 and 9, said Germany's Economy Ministry.


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