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SolarWorld in shock Opel offer, analysts dismissive

  German solar energy company SolarWorld said on Wednesday it was prepared to acquire cash-strapped carmaker Opel’s plants in Germany, but analysts dismissed the plan as unrealistic.

 

The Bonn-based company said in a statement it wanted to turn Opel into the first “green” auto company in Europe, making its offer conditional on a complete separation of Opel from its ailing US parent General Motors.

SolarWorld, whose shares had plunged 19% to €13.25 by 1359 GMT, said it would also seek compensation payments for Opel’s German staff positions totaling €1 billion -- matching the figure the car maker had said it would seek in state funding. “SolarWorld can provide Opel €250 million in cash and 750 million in bank credit lines subject to a guarantee from the federal government,” the company said.

Its Chief Executive Frank Asbeck, who flew to Berlin on Wednesday, told Reuters at the airport: “We’ve made a serious offer to General Motors to acquire the four German sites as well as the research and development facility in Ruesselsheim.” “We’re waiting for a response from GM. Big companies work slowly.” Asbeck added: “This is no gag. It’s a serious offer.”

German government officials said the announcement had taken them by surprise and that there were no meetings planned with Asbeck. Analysts were also dismissive of the SolarWorld plan, which comes days after Opel announced it was seeking about €1 billion in aid from the German government because its financial situation was threatened by the troubles of its US parent GM.

“Neither the government nor SolarWorld can separate Opel from GM. I think SolarWorld’s plans are unrealistic,” said Daniel Schwarz, an analyst at Commerzbank. Christian Breitsprecher, an analyst at Sal Oppenheim, called the plan “pretty crazy.”

SolarWorld is one of the three largest solar energy groups in the world and has more than 2,000 employees. It had sales of just under €700 million last year. It was founded in 1998 in Bonn by Asbeck. The firm benefited enormously from new energy laws set up by the Social Democrat-Greens government after it took power in 1998.

COPING WITH CRISIS

The company’s announcement came as Opel vowed to slash production to help it cope with a deepening crisis in the auto industry that is sweeping manufacturers across the globe. The head of Opel, Hans Demant, told the Wednesday edition of Germany’s Frankfurter Allgemeine Zeitung the company was preparing steps to help it weather a demand slump in the wake of the financial crisis. “We are preparing ourselves for bad times and are lowering our volume plans for 2009 by a good 10%,” he said.

Opel is the first European carmaker to seek government help. It has blamed its troubles on those of GM, which itself is lobbying Congress for government bridge loans to survive the downturn. German Chancellor Angela Merkel met with Opel representatives on Monday. She has said the government is ready to help Opel, which employs about 25,000 in its German plants in Ruesselsheim, Bochum, Kaiserslautern and Eisenach. But she has described Opel as a special case and played down the possibility of broader government help for the auto sector, despite calls for aid to be extended to other companies.

“I don’t share the view that Opel is a special case,” Peter Mueller, the conservative premier of the state of Saarland, told German public television station ZDF. “There should be help for all,” Mueller said, adding that aid should not be limited to the auto industry. (Reuters)