GM & Opel: Um, I Wouldn't Book That as Revenue Just Yet

Tuesday, Dec 29 2009 by

Sberbank's German Gref is still bent out of shape about GM's walking away from an Opel-Magna-Sberbank/GAZ deal:

Russian lender OAO Sberbank demanded compensation from General Motors Co. for the failed deal to buy the U.S. auto maker's German subsidiary, Adam Opel GmbH.

Sberbank's chief executive, German Gref, said in televised remarks Friday that GM should pay "voluntary" compensation for its decision in early November to scrap the selling of a 55% stake in the struggling Opel to Sberbank and Canadian auto-parts maker Magna International Inc.

"We think that GM's commitment went so far that they should have sealed the deal," Mr. Gref said.

Note to Gospodin Gref: a deal ain't a deal until the right people sign on the dotted line.

Voluntary.  That's pretty funny.  It also speaks volumes about Sberbank's legal position.  Meaning, they don't have one.  (Sorry, Sergei-but that's the way it is). I do agree with Gref on one thing: GM never should have gone as far as it did.  But it was better that it pulled out before it was too late.

The little DJ wires piece is entertaining for another reason: it provides a reminder of 2009's greatest pot-meet-kettle moment. The move to scrap the deal angered Russian politicians, and Prime Minister Vladimir Putin asserted that GM had exhibited an "arrogant attitude" in abandoning months of negotiations.

That still makes me laugh.

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About Craig Pirrong

Craig Pirrong

My day job (to the extent that I have a real job) is as Professor of Finance and Energy Markets Director of the Global Energy Management Institute at the Bauer College of Business, University of Houston. I have been in academia since 1989–shortly before the Ferruzzi soybean squeeze on the Chicago Board of Trade in July of that year, which was quite propitious and which had a big impact on the trajectory of my career. I have a PhD in Business Economics from the Graduate School of Business at the University of Chicago. more »

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