EU warns against protectionism in Opel sale

he Associated Press
Saturday, September 12, 2009; 11:27 AM

BERLIN -- The European Union's competition commissioner warned in comments published Saturday that she would take action against any protectionism in the sale of General Motors Co.'s European unit, Opel.

The Belgian government wants the EU Commission to investigate the Adem Opel GmbH deal amid concern that Germany may have sought to protect its own plants at the cost of others.

GM announced Thursday that a majority of Opel would be sold to Canadian auto parts maker Magna International Inc. and Russia's Sberbank, which Germany had pushed hard for. The deal likely would see a plant in Antwerp, Belgium close, while the company's four German plants remain open.

Germany offered euro4.5 billion ($6.5 billion) in credit to support the Magna bid.

"State support should not be subject to noncommercial conditions such as the location of investments and restructuring measures," Commissioner Neelie Kroes was quoted Saturday as telling Belgian newspaper De Tijd. "If something happens against the rules, I will take action."

Thursday's deal was a victory for Chancellor Angela Merkel ahead of German elections Sept. 27. Still, some members of the interim trust that has held a majority in Opel since June questioned what they saw as a politically motivated decision.

Dirk Pfeil, a trustee who abstained in a vote on the deal, said he leaned toward a rival bid from investor RHJ International, which he said "spared German jobs less and took more account of there also being a European component."
"The RHJ concept was simply more Euro-compatible," he told Deutschlandfunk radio.

Economy Minister Karl-Theodor zu Guttenberg suggested that even the Magna bid would involve more job cuts than previously thought.

"All involved knew since spring, also employee representatives ... that the number named by Magna applies only to the area of production, and that further job-cutting by Magna was to be feared in the administrative area," Guttenberg was quoted as telling the Bild am Sonntag newspaper.

The weekly Der Spiegel reported, without citing sources, that Magna foresees cutting not only the expected 3,000 production jobs in Germany but also 1,100 administrative jobs.

Opel employs some 25,000 people in Germany.

Posted in: Business-Economic,World News