Magna board set to approve Opel plans: sources

By Christiaan Hetzner and Angelika Gruber

FRANKFURT (Reuters) - Magna's (MGa.TO: Quote) board of directors is scheduled to approve on Tuesday a business plan for the acquisition of German carmaker Opel, two sources familiar with the matter said on Thursday.

The Canadian auto parts supplier and Opel parent General Motors GMGMQ.PK have already clarified most of the major issues in weeks of tough negotiations and they expect to resolve the last few issues holding up the takeover by July 7, the sources said.

The business plan would serve as the basis for talks with lenders like Commerzbank (CBKG.DE: Quote), which would finance the takeover, helped by an estimated 3 billion euros ($4.23 billion) in European state loan guarantees, they added.

One person involved in the deal said a lengthy meeting last Thursday between GM Chief Executive Fritz Henderson, lead GM negotiator John Smith, Magna Co-CEO Siegfried Wolf and Magna COO Herbert Demel clarified many of the major points still open.

"They came significantly closer to one another in the key points," the source said.

"On July 7 there is a board meeting at Magna. They then have to have the business plan that they worked out approved, but that should be a formal matter," that person added.

Another source close to the talks said: "The only remaining issue is whether 'New Opel' gets the sales distribution rights to GM's Chevrolet brand for the Russian market, but a solution should be achievable here."

Majority control over Opel, which also includes plants in Britain and Spain, is being sold as a precondition to state aid for the German carmaker now that bankrupt GM can no longer afford to finance its foreign subsidiary.