Using the blogosphere to help manage an auction is a tricky process.
On Wednesday we were among those
commenting on a Tuesday blog post by General Motors Co. group VP John Smith about the state of the auction for GM's Adam Opel GmbH unit. In his post Smith complained that the bid from Magna International Inc. (NYSE:MGA) and its Russian partners, Sberbank
and OAO Gaz, doesn't reflect the negotiations that led up to it and is, in fact, impossible for GM to execute. Smith called the rival bid, from Belgian private equity firm RHJ
International, simpler and easier to implement.
Smith, who is GM's lead negotiator on this deal, didn't say a word about the possibility of GM someday buying Opel back from RHJ -- an idea that's already been rejected by German officials, who favor the Magna bid. He also said GM had no preference between the two finalists. Nevertheless, toward the end of our piece we wondered whether GM's board might like the buyback idea. Other commenters went further on the point.
Meanwhile, a spokesman for German Chancellor Angela Merkel
fired a warning shot, saying that the German federal and state governments, providers of finance for either deal, reserved the right to veto a buyer.
So on Wednesday Smith posted an
update, saying (among other things) that no, "GM does not seek to reacquire majority control of Opel, from any investor candidate." Left standing are Tuesday's complaints about the Magna bid -- and, perhaps, some German suspicions that GM really does have a preference.
All of which -- this being the blogosphere -- prompts more questions from this quarter. Among them: Is the public critique of Magna's bid pushing it in the direction GM desires? And, given the way the financial crisis has mashed public and private together, are there other situations in which we'll see execs blogging their deals, or otherwise waging PR campaigns? The Nortel Networks bankruptcy auction -- with an
argument over the fate of wireless technology partly funded by Canadian taxpayers -- has some common elements here.
And here's one for German political leaders: If the conventional wisdom about the auto industry consolidating into six or so global giants is right, what do you see as the future of Opel, currently moving in the opposite direction? Perhaps this has been asked and answered already. Anyone seen the case laid out? -
Kenneth Klee
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