Hunt For Investors GM 'Ready to Give Away' Opel

General Motors is ready to give away its European units Opel, Vauxhall and Saab, according to a report in the Financial Times, The deal would be on condition that the investor pledges to put hundreds of millions of euros into a new firm to be formed from those subsidiaries.

Struggling US automaker General Motors is prepared to hand over a controlling stake in its European units Opel  and Vauxhall for nothing, provided the investor pledges to put at least €500 million ($650 million) in equity into a new company to be formed from its European operations, the Financial Times reported on Monday, citing two people familiar with the plans.

GM is also prepared to hand over its Swedish brand Saab for free, the newspaper reported. Saab filed for creditor protection in February.

GM has agreed to hand back patents to Opel and to pay outstanding debts to boost the German unit's chances of surviving as a standalone business.

According to the FT, GM wants to merge Opel and Saab in a separate company to be based in Germany. The car giant wants several European governments led by Germany to provide loan guarantees totalling €3.3 billion for the European operations.

The aim is to prevent a possible GM insolvency from engulfing Opel, which says it has sufficient liquid funds to carry on its operations as normal.

On Friday, GM CEO Fritz Henderson said there were more than six potential investors interested in Opel, but he didn't identify them. He said they included financial investors and companies in the sector.

cro -- with wire reports
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