Fiat pull-out threatens Opel deal

Fiat has said it would not attend in a dispute over financing

A top-level meeting on a rescue plan for car maker Opel is in jeopardy after Italy's Fiat, one of two remaining bidders for the General Motors unit, said it would not attend in a dispute over financing.

With rival bidder Magna International in talks with GM, officials said lower-level German government officials still planned to meet to review the state of negotiations.

But Thomas Steg, a spokesman for German chancellor Angela Merkel, said a high-level meeting with the chancellor, GM, Opel, the US Treasury and bidder representatives would only happen if "those involved... have something substantial to produce, contracts that carry their signatures".

"We expect a letter of intent," Steg said. "To what extent those involved are far enough along to produce this, I can't say."

Germany is looking for an agreement that will shield Opel - which employs 25,000 people in Germany - from a looming GM bankruptcy court filing and extensive restructuring.

The government wants to make it legally independent under a trustee, then provide bridge financing while Opel looks for a new, permanent owner.

The German government, which is seeking to minimise job losses and expense to German taxpayers, has been negotiating with two suitors - Italy's Fiat and Canadian auto parts maker Magna, which submitted a bid along with Russian lender Sberbank. GM and the US Treasury Department are also part of the negotiations.

But on Friday morning Fiat CEO Sergio Marchionne said his company would not be attending talks, saying the company faced "unreasonable" funding demands.

He stressed, however, that Fiat was not withdrawing its bid for Opel.