German states set to grant Opel aid: reports

25th May 2010, Comments 0 comments

Three German states where the automaker Opel has plants are set to grant requested financial guarantees, while Opel's parent group GM waits for word on similar aid from Berlin, press reports said Tuesday.

The government in Thuringia, central Germany, will approve loan guarantees worth 27.9 million euros (34 million dollars) for Opel, the Sueddeutsche Zeitung newspaper reported.

In North Rhine-Westphalia, western Germany, officials are set to grant 100 million euros in guarantees and a similar decision is expected in Rhineland-Palatinate, Handelsblatt added.

In Hesse, western Germany, where Opel's headquarters are located, authorities are more reserved, Handelsblatt said.

Opel unveiled on Friday an agreement with workers on a restructuring plan and said the carmaker had also found banks willing to lend it money if reimbursement were guaranteed by the government.

At the level of national authorities however, "no final decision has been taken," German Economy Minister Rainer Bruederle said in Brussels.

A commission of economists must submit a non-binding opinion on aid to Opel, which has asked for more than one billion euros in loan guarantees from the federal and state governments.

Bruederle said the commission would meet in the coming days, and Nick Reilly, head of GM Europe told Handelsblatt he was optimistic German politicians would in the end grant approval for the aid.

© 2010 AFP

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