GM Will Sell Opel to Magna, Accepting German Choice

General Motors Co. agreed to sell its Opel unit to Magna International Inc., accepting the German government’s preference over a financial investor that the U.S. carmaker had favored.

Magna, Canada’s biggest auto-parts maker, and its Russian partner OAO Sberbank will acquire a 55 percent stake in Opel, Detroit-based GM said in a statement. GM, Magna and Germany resolved disputes over Opel’s access to GM intellectual property and financing issues in the past two weeks, according to a person familiar with negotiations.

GM, having emerged from bankruptcy in July, had preferred a rival bid by Brussels-based RHJ International SA and considered keeping the money-losing unit. Chancellor Angela Merkel’s government, which offered 1.5 billion euros ($2.2 billion) in loans to keep Opel afloat, chose Magna and Moscow-based Sberbank as the preferred bidder in May to help preserve German jobs.

“I know that a difficult path still lies ahead for Opel,” Merkel said in at press conference in Berlin. The deal offers a model for how companies and workers can work together to “find ways out of a crisis affecting the entire auto industry.”

Merkel’s government, facing Sept. 27 federal elections, has a say in the decision because it offered 4.5 billion euros in loan guarantees to back Magna’s bid. Magna’s proposal foresees a linkup with OAO GAZ, the Russian carmaker that said in May that it wants to produce 180,000 Opel cars at its main Russian site.