Detroit — Frank Stronach's vision of turning his Magna International Inc. into a full-fledged auto maker has vanished after General Motors Co. decided to hang on to its battered European subsidiary.
The GM move, made after Magna and its Russian partner Sberbank reached a deal to buy 55 per cent of the company, came as the auto maker's board of directors made a final decision on the Magna-led offer late Teusday.
Mr. Stronach was even-handed about the decision, saying “life goes on.”
“You take it as it comes and you go on and look for other opportunities,” he said. “It's not for us to criticize the customer.”
GM is Magna's largest customer.
The Magna-led bid appeared to have won out over competing offers from Belgium-based investment company RHJ International and auto maker Fiat SpA, after Magna won approval from the German government, which was leading the rescue attempt for Opel. GM has owned Opel since 1929.
But GM appeared to change its mind about selling the Germany-based auto maker and Opel's British unit Vauxhall after a quick trip through Chapter 11 bankruptcy protection in the United States.
A statement by the auto maker late yesterday backed up that view.
“Given an improving business environment for GM over the past few months and the importance of Opel/Vauxhallto GM's global strategy, the GM board of directors has decided to retain Opel,” GM said.
More to come
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