According to the Financial Times, General Motors (NYSE: GM) expects "as many as three bids" for a strategic stake in its European arm by today's deadline. GM Europe spokesman Chris Preuss stated, "Based on conversations that are ongoing, the expectation is that there will be three bids put on the table." GM expects to rake in $887 million for the division.
The report quotes "two people close to the deal, who requested anonymity" as saying the three bids could come from Fiat, Canadian parts manufacturer Magna, and Brussels firm RHJ International.
The next step in the process is for GM to look at the offers and start discussions with the German government and labor reps. The final deal for the Opel division could take "weeks or months" to prepare. The next step would be for GM to sign a memorandum of understanding (MOU) with a preferred bidder -- although "there could be more than one MOU." The American automaker will give preference to cash bids for Opel, which the report notes could rule out Fiat. The Italian company's CEO Sergio Marchionne is opposed to pushing further money into Opel.
Yesterday, GM noted that it does not expect to reach deals with the United Auto Workers and U.S. Treasury on debt-exchange swaps. These swaps are not expected prior to the May 26 expiration date for a debt-for-equity offer to unsecured bondholders. A deal with the bondholders is then needed by June 1 for Washington to consider GM viable and healthy enough for a turnaround.
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