RUESSELSHEIM, Germany and GENEVA, March 2, 2010 /PRNewswire/ --
-- General Motors Unveils Threefold Increase in Turnaround Investment
-- Parent Company to Provide More Than 50 Percent of Overall Funding
Opel/Vauxhall today announced that its parent company General Motors will contribute a substantial EUR1.9 billion funding package as part of its commitment to the European viability plan, more than tripling its previous investment pledge of EUR600 million.
Unveiling the increased funding package, Nick Reilly, CEO of Opel/Vauxhall, said the GM contribution would be made in the form of both equity and loans.
Under its viability plan, Opel/Vauxhall had estimated funding requirements of EUR3.3 billion. However, an additional EUR415 million had been requested by the respective European governments to offset the potential impact of adverse market developments.
In a vote of confidence in Opel/Vauxhall's long-term business strength, GM will now contribute more than 50 percent of the overall funding requirements. As a result, the requested total of loan guarantees from European governments will decline from EUR2.7 billion to under EUR2 billion.This commitment by GM removes any potential liquidity risks during the restructuring this year.
"GM's EUR1.9 billion commitment is the right course of action for Opel/Vauxhall and should clearly signal our determination to fix our business," said Nick Reilly. "Our call for the additional funding was approved by GM's senior management and supported by the GM Board of Directors. Meanwhile, we have shared this decision with the European Commission as well as the national and state governments involved. We hope that our strong commitment will be well received as a major milestone in our ongoing discussions about government guarantees to cover the remaining gap."
"We greatly value the much increased support from GM, particularly given the high-priority demands on their liquidity, not least the restructuring of GM's North American operations and coping with a continuously weak market in North America," Reilly added.
"It is of vital importance for GM to demonstrate our commitment for our European operations," said Ed Whitacre, GM Chairman and CEO. "Beyond the purely financial aspects, we see this as a major step towards instilling renewed trust and confidence into Opel/Vauxhall's customers, employees, business partners, unions, dealers and European governments."
Contact:
Stefan Weinmann
Tel: + 49(0)6142-7-77339
Mobile: +49(0)175-228-9453
stefan.weinmann@de.opel.com
Ulrich Weber
Tel: +49(0)6142-7-72279
Mobile: +49(0)160-9785-1410
ulrich.weber@de.opel.com
Text can be downloaded at http://media.opel.com.
Contact: Stefan Weinmann, Tel: + 49(0)6142-7-77339, Mobile: +49(0)175-228-9453, stefan.weinmann@de.opel.com; Ulrich Weber, Tel: +49(0)6142-7-72279, Mobile: +49(0)160-9785-1410, ulrich.weber@de.opel.com
