SolarWorld Offers $1.26 Bill for Car Maker Opel

Nov. 19, 2008
Company said it would create the 'first green European automotive group'

German solar power group SolarWorld caught the auto industry by surprise on Nov. 19 when it unveiled what it said were preparations for a takeover of troubled GM's German car division Opel. SolarWorld said it would offer a billion euros (US$1.26 billion) for Opel and create the "first green European automotive group" in a move that had analysts reaching for calculators and scratching their heads.

A SolarWorld statement said it would offer 250 million euros in cash and 750 million euros in bank credits for Opel's four auto factories and a research center in Ruesselsheim, western Germany. Its goal was "to produce a new generation of vehicles with energy-efficient, low-emission drives in the future."

It attached several conditions to the deal however, including a complete split of Opel from GM, which is threatened with bankruptcy, and compensation payments of 40,000 euros per Opel worker, which would total roughly one billion euros.

SolarWorld, which also sought a liquidity guarantee for Opel from the German government, did not say how it expected to pay the compensation.

SolarWorld said it would keep making Opel brand cars in the plants and would "offer electric drive and hybrid drive vehicles in the future." The statement quoted chairman Frank Asbeck as saying: "The group has already been working for some years on the development and testing of electric drive vehicles that are propelled by solar energy and that even participate successfully in motor racing." SolarWorld employs 2,000 workers, while Opel's German staff numbers about 26,000.

The German automaker has been hit by slumping sales and financial problems at its parent company, and has asked the German government for loan guarantees if it can no longer obtain GM financing. The Frankfurter Allgemeine Zeitung newspaper quoted Opel directors on Nov. 19 as saying that the company will cut output next year and is mulling a 30-hour work week.

Copyright Agence France-Presse, 2008

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