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| GM ponders future as deal fails | GM ponders future as deal fails |
| (10 minutes later) | |
| General Motors' battle to avoid bankruptcy has suffered a blow as bondholders have rejected a key part of the carmaker's restructuring plan. | General Motors' battle to avoid bankruptcy has suffered a blow as bondholders have rejected a key part of the carmaker's restructuring plan. |
| The board will now meet to discuss its "next steps" after a large number of investors refused to exchange their debt for company shares. | The board will now meet to discuss its "next steps" after a large number of investors refused to exchange their debt for company shares. |
| Meanwhile, the German government is set to begin a series of meetings later to consider bids for GM's European arm. | Meanwhile, the German government is set to begin a series of meetings later to consider bids for GM's European arm. |
| Four bidders are in the running for its Opel and Vauxhall operations. | Four bidders are in the running for its Opel and Vauxhall operations. |
| German Chancellor Angela Merkel is set to meet GM representatives and US government officials at 2000BST on Wednesday night. | German Chancellor Angela Merkel is set to meet GM representatives and US government officials at 2000BST on Wednesday night. |
| Although the ultimate decision rests with GM in Detroit, Germany's preference is crucial as the government is being asked to put up hefty loan guarantees for the winning bidder for GM Europe. | |
| Setback | Setback |
| THE FOUR GM EUROPE BIDS Fiat, Italian carmaker - 10,000 job cuts in Europe; could close one of four Opel factories in GermanyMagna, Canadian-Austrian car parts group - 2,500 job cuts in Germany; plans to inject between 500m and 700m euros into Opel; 10% of the new company would be owned by Opel employees; GM would keep a 35% stake in the company; bid in connection with Russia's state-run Sperbank and Oleg Deripaska's truck firm GazRHJ International, private equity firm based in Brussels - reports suggest it would also give employees a 10% equity stake in the companyBeijing Automotive Industry Corporation, car producer - China's fifth largest car producer is a late entrant to the bidding The possible buyers of Opel | THE FOUR GM EUROPE BIDS Fiat, Italian carmaker - 10,000 job cuts in Europe; could close one of four Opel factories in GermanyMagna, Canadian-Austrian car parts group - 2,500 job cuts in Germany; plans to inject between 500m and 700m euros into Opel; 10% of the new company would be owned by Opel employees; GM would keep a 35% stake in the company; bid in connection with Russia's state-run Sperbank and Oleg Deripaska's truck firm GazRHJ International, private equity firm based in Brussels - reports suggest it would also give employees a 10% equity stake in the companyBeijing Automotive Industry Corporation, car producer - China's fifth largest car producer is a late entrant to the bidding The possible buyers of Opel |
| GM has been trying to do a deal with bondholders, under which they would trade in $27bn in debt for a 10% stake in the recapitalised company. | GM has been trying to do a deal with bondholders, under which they would trade in $27bn in debt for a 10% stake in the recapitalised company. |
| The failure of the offer is a significant set back for the US car giant, which is trying to avoid having to seek bankruptcy protection ahead of a US-government imposed 1 June deadline. | The failure of the offer is a significant set back for the US car giant, which is trying to avoid having to seek bankruptcy protection ahead of a US-government imposed 1 June deadline. |
| The failure was not unexpected, though. The majority of bondholders had been against the deal from the start, believing that the stake being offered was too small. | The failure was not unexpected, though. The majority of bondholders had been against the deal from the start, believing that the stake being offered was too small. |
| The other key part of the restructuring, an agreement with unions, had been more successful. The powerful United Auto Workers union agreed to take a 20% stake in GM, down from the 39% in the original plan. | The other key part of the restructuring, an agreement with unions, had been more successful. The powerful United Auto Workers union agreed to take a 20% stake in GM, down from the 39% in the original plan. |
| Bidding war | Bidding war |
| The German government had been expected to name its preferred bidder after a series of meetings which are predicted to stretch late into the night on Wednesday. | The German government had been expected to name its preferred bidder after a series of meetings which are predicted to stretch late into the night on Wednesday. |
| But a government spokesperson suggested it was "much more probable that talks will be continued with at least two investors after today's meeting". | But a government spokesperson suggested it was "much more probable that talks will be continued with at least two investors after today's meeting". |
| That would be in line with the wishes of the UK government. A spokesperson for UK Business Secretary Lord Mandelson said GM wanted to keep talking with all bidders. | That would be in line with the wishes of the UK government. A spokesperson for UK Business Secretary Lord Mandelson said GM wanted to keep talking with all bidders. |
| All had committed to maintain Vauxhall production in the UK, he added, where the carmaker employs 5000 people: 1200 at the Luton van plant, and 2000 at Ellesmere Port making Astras. | All had committed to maintain Vauxhall production in the UK, he added, where the carmaker employs 5000 people: 1200 at the Luton van plant, and 2000 at Ellesmere Port making Astras. |
| Derek Simpson, general secretary of the Unite union in the UK, fears the German government will support a bid which offers no protection to British workers. | Derek Simpson, general secretary of the Unite union in the UK, fears the German government will support a bid which offers no protection to British workers. |
| Jobs at stake | Jobs at stake |
| Opel has its headquarters in Germany, and 25,000 of the firm's 50,000 workers are employed in the country. | Opel has its headquarters in Germany, and 25,000 of the firm's 50,000 workers are employed in the country. |
| The four bidders for GM Europe are Italy's Fiat, Canada's Magna, Belgium's RHJ and China's Beijing Automotive Industry Corporation (BAIC). | The four bidders for GM Europe are Italy's Fiat, Canada's Magna, Belgium's RHJ and China's Beijing Automotive Industry Corporation (BAIC). |
| With an election looming, Berlin does not want to see too many job losses arising from the takeover. | With an election looming, Berlin does not want to see too many job losses arising from the takeover. |
| Magna says it will lay off 2,500 workers in Germany, while Fiat says it will cut 10,000 jobs across Europe, including 2,000 in Germany. | Magna says it will lay off 2,500 workers in Germany, while Fiat says it will cut 10,000 jobs across Europe, including 2,000 in Germany. |
| BAIC, however, says it will not cut any jobs for at least two years. The German government is considering the bid from the Chinese carmaker, a spokesperson said, although it would not be present at Wednesday's meetings. | BAIC, however, says it will not cut any jobs for at least two years. The German government is considering the bid from the Chinese carmaker, a spokesperson said, although it would not be present at Wednesday's meetings. |
| Do you work in one of Vauxhall's UK plants? What is the current mood among the workforce? What do you think is the best solution? Send us your comments. | Do you work in one of Vauxhall's UK plants? What is the current mood among the workforce? What do you think is the best solution? Send us your comments. |
| The BBC may edit your comments and not all emails will be published. Your comments may be published on any BBC media worldwide. Terms & Conditions | The BBC may edit your comments and not all emails will be published. Your comments may be published on any BBC media worldwide. Terms & Conditions |