TURIN, Italy -- General Motors' U.S. bankruptcy filing will not obstruct plans to sell the company's subsidiaries in Europe -- a process that is advancing while plenty of issues remain unresolved.
GM signed a memorandum of understanding on Saturday to sell 65 percent of Adam Opel to a Russian-backed consortium led by Canadian supplier Magna International Inc., of Aurora, Ontario.
Magna co-CEO Siegfried Wolf said details must be ironed out.
“In five weeks' time, we should have the formal signing of the contract,” he said.
GM Europe President Carl-Peter Forster said on Monday: "The process for a future partnership in Adam Opel GmbH has moved a critical step forward with the MOU reached with Magna International, whose leadership has shown strong commitment to this project."
He added: "With the financing, even with the GM actions in the U.S., we can now confidently say to our employees, customers, suppliers and dealers that it's business as usual as we go through the process of creating a new, more independent Opel/Vauxhall.”
The German government expects the deal with Magna, North America's largest partsmaker, to close by September.
Meanwhile, a Swedish court last week granted GM's money-losing Saab unit an extension of its protection from creditors -- to Aug. 20 -- allowing Saab to find a new owner and restructure its business. Saab was put up for sale by GM earlier this year and sought protection from creditors in February.
Opel is now acting as an umbrella company for all GM Europe operations except Saab. Last Wednesday, GM transferred ownership of its U.K.-based Vauxhall unit to Opel. The Opel holdings encompass nine assembly and eight powertrain plants.
While final negotiations with Magna proceed, GM will own 35 percent of Opel. The remaining 65 percent will be temporarily controlled by an independent trust managed by five trustees. Two trustees will be chosen by the German government, and one will come from General Motors. It is not clear who will appoint the other representatives.
GM Europe has an agreement for 1.5 billion euros ($2.13 billion) in bridge financing from the German government.
None of GM's operations outside the United States are included in the U.S. court filings. The company confirmed that all business operations are continuing without interruption in its regions in Europe; Latin America, Africa and the Middle East; and the Asia-Pacific.
The new Opel will get a 300 million-euro ($427 million) emergency loan from Magna and the Canadian auto supplier's partner, Sberbank, a state-controlled Russian bank. When the sale is completed, Magna said, GM and Sberbank will be Opel's largest shareholders, with 35 percent each. Magna will have 20 percent, and the remaining 10 percent could be in the hands of Opel workers and dealers.
Germany will provide 4.5 billion euros ($6.4 billion) in loan guarantees, including a bridge loan worth up to 1.5 billion euros ($2.1 billion) from state banks. Half of the loan proceeds will come from the federal government and half from the governments of four states with Opel plants: Hesse, North Rhine-Westphalia, Thuringia and Rhineland-Palatinate.
Later, Magna and Sberbank plan to inject an additional 500 to 700 million euros ($711 million to $995 million) into Opel.
GM says it will maintain deep product development ties with Opel.
“Any deal in Europe will include GM holding a significant stake in the new entity,” said company spokesman Chris Preuss. “Any concept that has been looked at about realigning the Opel assets has always concluded that they would stay aligned pretty tightly to the GM product development network.”
Two front-runners to buy Saab have emerged, the Swedish business daily Dagens Industri reported last week. They are Swedish luxury carmaker Koenigsegg and Renco Group, a U.S. investment company. The newspaper cited Fiat as a third suitor.
Saab spokeswoman Gunilla Gustavs declined to comment on the report. Saab and GM plan to announce a preferred candidate in the coming weeks, she said.
Gustavs said Saab is not concerned that the U.S. bankruptcy filing will disrupt the sale of the Swedish company.
On Friday, Fiat S.p.A. CEO Sergio Marchionne said his company remains interested in acquiring Saab. That same day, Fiat withdrew its bid for Opel, calling a request for an emergency loan “unreasonable.”
Fiat's offer for Opel included Saab, while Magna's doesn't.
Last weekend, Swedish Prime Minister Fredrik Reinfeldt warned that Saab is in a difficult position after being left out of the Opel deal.
"This is a very vulnerable and difficult position that Saab is in," Reinfeldt told the local TT news agency.
Saab has asked creditors to write off 75 percent of the company's $1.4 billion debt, most of which is owed to GM. GM also has agreed to provide $250 million worth of equipment, which Saab will use to produce its new car models.
Reuters contributed to this report