Fiat lets Opel offer stand

Fiat has decided to let its offer for German automaker Opel stand unchanged and will not attend further talks with German government officials.
The sale of Opel ran into an impasse on Thursday when it was reported that parent company General Motors wanted 450 million euros, and not 100 million euros as previously expected, from the 1.5-billion-euro bridge loan Germany's federal and regional governments were ready to offer to allow the European marque to be spun off as a separate company.
Since the German government has no intention of increasing the loan, it was implied that potential bidders for Opel, which aside from Fiat includes Canadian-Austrian auto parts maker Magna International, would have to come up with the extra 350 million euros Opel needed.
Fiat replied by saying that the situation had become ''complicated'' and that while it remained interested in Opel, it was not ready to take ''unusual risks'', given that it did not have a full picture on the state of Opel's financial affairs.
CEO Sergio Marchionne later explained that ''it is unreasonable to expect Fiat, on the basis of sound business judgement and proper governance of its affairs, to provide funds to an organization whose financial details and position are unknown''.
Fiat has based its offer for Opel not on cash but on making it part of a trans-Atlantic auto giant, together with Detroit No.3. Chrysler, capable of rivaling Volkswagen and Toyota.
On Thursday, Magna, which is being backed in its bid by Russia's biggest bank, Sberbank, indicated that it may be willing to come up with the extra 350 million euros.
However, the online edition of the German daily Bild on Friday reported that Magna was ready to ''throw in the towel''.
According to Bild, while negotiations continue between Magna and GM, the American automaker ''keeps making new demands and Magna is one step away from throwing in the towel''.
A German government spokesman said on Friday the fact that Fiat would not take part in negotiations with government officials did not mean it was out of the running for Opel.
According to Thomas Steg, ''it is not surprising that Fiat has decided not to join the talks, since it has nothing new to add to its offer''.
He then hinted that there may not be a meeting on Friday at all if revised letters of intent from the potential bidders do not arrive.
Given Fiat's position to let its offer stand, the spokesman said that ''everything now depends on the outcome of the talks Magna is having with GM and the American government''.
GM must sell its European division in order to respect a proposed restructuring plan and qualify for further US federal bail-out funds.
Fiat Chairman Luca Codero di Montezemolo said on Friday that his company had done ''all it could do'' to try and acquire Opel.
''As I have said before, our goal was and remains that of creating Europe's second-biggest automaker, if the conditions exist to do so. At this point, there's nothing more we can do,'' he added.