Good morning! Two years after GM reneged on the Opel sale to Magna and Sperbank, the Times of London has the big scoop. GM cancelled the sale of Opel because the buyers wanted the right to sell its factories to a Russian state-owned car maker, says the Times, citing U.S. diplomatic cables revealed in Wikileaks. Really? You don’t say! We are shocked! (Read More…)
Back in 1976, the Italian automaker Fiat had been badly battered by a global energy crisis and the resulting malaise infecting the global auto industry. In what Time Magazine described at the time as “a devastatingly ironic example of petropower,” Col. Muammar Gaddafi instructed his Libyan Arab Foreign Bank to invest some $415m into the Italian automaker, giving it a stake that would eventually grow to some 14 percent of the firm’s equity.
By 1986, Fiat’s Libyan stakeholders were becoming more trouble than they were worth. In the wake of the Lockerbie bombings, the US introduced sanctions on Libya, and Fiat’s Libyan connection left its attempts to bid for US military contracts (particularly those related to Ronald Reagan’s Strategic Defense Initiative) dead on arrival. As a result, Fiat and its shareholders bought back the entire 14 percent Libyan stake in the firm, presenting the Libyan Arab Foreign Bank-controlled Banca UBAE with a $3.1b check. And, according to what a Fiat spokesperson told us yesterday, that is where the story ends. But thanks to the now-ubiquitous Wikileaks, we have found that this story may in fact go farther than that. In fact, as the evidence stands right now, either the US State Department is working with bad information (which major news sources have yet to correct), or Fiat is lying about its ties to the embattled Gaddafi regime.