UPDATE 1-Opel management, labour sign restructuring deal

* Master agreement signed on Monday – Opel labour boss Franz

* Workforce safe from more cuts if no aid offered -Franz

* German rescue fund met, no word on recommendation for aid

* German EconMin says it decides whether Opel gets state aid

(Recasts adding comments from labour, EconMin)

By Christiaan Hetzner

FRANKFURT, May 31 (BestGrowthStock) – A restructuring deal at
General Motors’ [GM.UL] loss-making European carmaker Opel was
signed into effect on Monday, aimed at saving 265 million euros
($325 million) in annual wage costs through 2014, labour leader
Klaus Franz said.

After drafting a master agreement on May 21, European union
and workforce representatives from countries hosting Opel’s
major manufacturing plants also signed the deal with Opel Chief
Executive Nick Reilly.

Franz said the signatures meant neither side can now
withdraw from the contract, eliminating concerns that it might
only be valid if Germany agrees to over 1 billion euros in loan

“In the unlikely event that Germany doesn’t grant state aid,
we can no longer be extorted,” Franz told Reuters, adding that
all the conditions and terms agreed earlier had been adopted
into a final binding agreement.

Spokespeople for Opel could not immediately be reached for

All parties to the deal had signed apart from
representatives from the Opel plant in Bochum, Franz said,
adding he expected them to sign soon.


Earlier on Monday business advisers to Germany’s rescue fund
met in Berlin to discuss whether to recommend extending loan
guarantees to Opel, but the result of the talks was not known.

Parent General Motors had requested state aid from European
governments to help fund a costly turnaround plan at Opel that
would shrink its production and labour capacity by about 20
percent. [ID:nLDE64O0GC]

GM’s own return to the black has provided opponents within
Germany plenty of ammunition to argue against aid to Opel

The advisers to the rescue fund are mainly former captains
of German industry, such as ex-Schering CEO Hubertus Erlen and
industry lobby group BDI’s former head Michael Rogowski.

Even if they agreed on a recommendation on Monday the
decision ultimately remains a political one and German Economics
Minister Rainer Bruederle has indicated more time will pass
before the issue can finally be settled. [ID:nLDE64O0J4]

“In the end, the decision lies with the Economics Ministry,”
Bruederle told reporters in Brussels on Monday, reaffirming he
remained sceptical about giving aid to Opel despite the repeated
calls from four German states which host plants.

Investing Advice
(Additional reporting by Ilona Wissenbach in Brussels; Editing
by Jon Loades-Carter, Greg Mahlich)

UPDATE 1-Opel management, labour sign restructuring deal