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Opel and Vauxhall to go to Magna Opel and Vauxhall to go to Magna
(20 minutes later)
General Motors (GM) has chosen the Canadian car parts manufacturer Magna to buy Opel and sister firm Vauxhall, German Chancellor Angela Merkel says. General Motors (GM) has announced that it has chosen the Canadian car parts manufacturer Magna to buy Opel and its sister company Vauxhall.
But full details of the terms of the sale have yet to be released. The decision was welcomed by German Chancellor Angela Merkel, who said she was "very pleased" about it.
Earlier, there had been rumours that GM could be planning to try to keep control of its European arm. Magna, which is backed by Russia's Sberbank, has said that it will keep all four German plants open.
Magna was the German government's preferred bidder. The decision must be approved by the Opel Trust, which is due to hold a press conference shortly. But British unions have expressed concern about the future of Vauxhall's 5,000 UK workers.
Magna has pledged to keep all German plants open. A spokesman for Magna said that the company is committed to keeping open the Ellesmere Port plant, where the Astra is made.
"I am very pleased about the decision that's been made and it is along the lines that the federal government has been advocating," Chancellor Merkel said. Uncertainty continues
"But it's also along the lines that the employers and the employees of Opel wanted." ANALYSIS By Jorn Madslien, Business reporter, BBC News website
Rival offer Victory for German Chancellor Angela Merkel in the lengthy tug-of-war over the future of Opel should go a long way towards safeguarding the jobs of most, if not all, of the company's 25,000 workers in Germany.
But although the sale of a controlling stake to Magna is backed to the tune of 4.5bn euros (£4.5bn; $6.5bn) by the German government, it does not remove the need for sharp cost-cuts elsewhere.
The sale signals the start of a restructuring process, with an expected 10,000 out of 50,000 Opel and Vauxhall jobs in Europe being axed.
Chancellor Merkel has said she will discuss with its European partners "the distribution of the burden", which probably means that any European government wanting to safeguard jobs in their country must also come up with substantial amounts of cash.
He added that the company plans to honour its existing contract to produce vans in Luton until 2013 and will try to find a way to keep the plant in production after that date.
"The uncertainty surrounding the ownership of Vauxhall is now over, but the uncertainty surrounding the long-term future of Britain's plants will continue," said Tony Woodley, general secretary of the Unite union.
"We need to make sure that British plants and people are not treated disproportionately during the restructuring that will take place."
GM will be selling a 55% stake in the new Opel to Magna and Sberbank. Employees will hold a 10% stake and GM will keep the rest.
BBC business correspondent Martin Shankleman said that this was the option that the GM board appeared to be resisting.BBC business correspondent Martin Shankleman said that this was the option that the GM board appeared to be resisting.
See GM production centres in EuropeEnlarge Map
The UK unions were also against it as they feared the UK could be at the forefront of any job losses, he said.The UK unions were also against it as they feared the UK could be at the forefront of any job losses, he said.
UK unions favoured GM keeping control of Vauxhall - saying this would be the best news for British jobs.UK unions favoured GM keeping control of Vauxhall - saying this would be the best news for British jobs.
Chancellor Merkel said that "patience" during the long-running discussions had led to a decision being reached.Chancellor Merkel said that "patience" during the long-running discussions had led to a decision being reached.
The German-led Opel Trust has controlled the European operations since GM sought bankruptcy protection in the US in June this year.The German-led Opel Trust has controlled the European operations since GM sought bankruptcy protection in the US in June this year.
See GM production centres in EuropeEnlarge Map
It contains representatives from GM, the German federal government and the German states that contain Opel plants.It contains representatives from GM, the German federal government and the German states that contain Opel plants.
The rival offer came from the Belgian investment group RHJ.The rival offer came from the Belgian investment group RHJ.
Opel employs a total of 54,500 workers across Europe, with 25,000 based in Germany.Opel employs a total of 54,500 workers across Europe, with 25,000 based in Germany.
Its Vauxhall brand employs 5,500 people in the UK, primarily at its two British plants in Luton and Ellesmere Port.Its Vauxhall brand employs 5,500 people in the UK, primarily at its two British plants in Luton and Ellesmere Port.
GM in the US emerged from 40 days of bankruptcy protection in July, based on a plan involving disposing of many of its brands. It is now 61% owned by the US government.GM in the US emerged from 40 days of bankruptcy protection in July, based on a plan involving disposing of many of its brands. It is now 61% owned by the US government.
Are you a Vauxhall/Opel employee or dealer? Send us your comments using the form below.Are you a Vauxhall/Opel employee or dealer? Send us your comments using the form below.
The BBC may edit your comments and not all emails will be published. Your comments may be published on any BBC media worldwide. Terms & ConditionsThe BBC may edit your comments and not all emails will be published. Your comments may be published on any BBC media worldwide. Terms & Conditions