China moves on Opel with BAIC bid

By Angelika Gruber and Christiaan Hetzner

FRANKFURT/MUNICH (Reuters) - A Chinese automaker has offered to buy a stake in General Motors unit Opel, challenging a deal from Canadian auto parts supplier Magna, sources said on Friday.

State-owned Beijing Automotive (BAIC) has submitted an indicative, non-binding offer for Germany's Opel, sources familiar with the situation told Reuters, and would make a binding offer by mid-July.

The news comes ahead of a Friday deadline for GM lawyers to submit papers to U.S. federal bankruptcy Judge Robert Gerber who will rule by July 10 on a plan to create a "new GM" with brands Chevrolet, Cadillac, Buick and truck unit GMC.

Magna, backed by Russian partners, is the frontrunner to buy Opel. Sources told Reuters Thursday that Magna's board of directors wants to approve a business plan for Opel on July 7.

Belgian holding company RHJ International is the third bidder, although it posted a sharply wider full-year loss on Wednesday and analysts are doubtful it has the cash to compete with its rival suitors.

Whoever wins the race for Opel faces a tough antitrust probe, a German government minister said Friday.

When asked whether he counted on Brussels examining any deal for Opel under a lengthier, so-called 'phase II' investigation, German Deputy Economics Minister Jochen Homann told reporters: "Yes, clearly."

He declined to specify what issues might concern EU competition authorities since the German government is still awaiting a business plan for the takeover, which he hoped to get by the end of July.