Friday May 29, 09:10 AM
Fiat unable to offer more for Opel
ROME (AFP) - Italian auto giant Fiat (Milan: F.MI - news) said it could not improve its offer to buy Germany's Opel against a rival bid by Canada's Magna International and would not attend key talks in Berlin on the takeover.
"We have already offered to contribute our auto business assets to the merger on a debt-free basis and thus provide substantial, and absolutely necessary, equity to the merger," Fiat boss Sergio Marchionne said in a statement, adding: "More cannot be asked."
Fiat negotiators will therefore not attend the meeting with the German government in Berlin on Friday because its "sole topic" will be emergency funding for Opel, a subsidiary of near-bankrupt US automaker General Motors (NYSE: GM - news) , the statement said.
"It is in fact unreasonable to expect, on the basis of prudent business judgment and proper governance of its affairs, that Fiat would provide funds to an organisation whose financial details and position remain unknown to date," the statement said.
The Italian group "remains open and committed to continue discussions with all parties involved with a view to find a stable and lasting solution for the industrial activities of Opel," it said.
German officials were to hold further talks Friday to try to clinch a rescue deal for Opel ahead of an expected bankruptcy filing by GM, even after talks with Washington broke down in acrimony.
Chancellor Angela Merkel was expected to hold further negotiations in the afternoon with the US government, GM and Magna.
German officials remained confident of reaching a deal aimed at finding a suitable buyer for Opel and a financing structure for temporary loans from the German government, stalling when the US side suddenly upped their demand for loans by 300 million euros (416 million dollars).
Opel's powerful works council described the breakdown in talks as a "bitter setback" and accused GM of treating Opel as a "chip in the poker game of their own insolvency."
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