2nd UPDATE: Germany Picks Magna Bid For GM's Opel: Source

BERLIN (AFP)--Germany has selected a bid by Canadian auto parts maker Magna (MGA) to take over General Motors' (GM) Opel unit, backed by a Russian bank and in conjunction with Russian automaker GAZ (GAZA.RS), a source said Saturday.

"There has been a result. Magna is on board," a government source said after late-night marathon negotiations at Chancellor Merkel's office here.

The deal, struck after talks between top German politicians as well as US government officials and both firms, would see GAZ making Opel vehicles in Russia, backed by Russia's top bank, state-controlled Sberbank.

Although the decision on the fate of GM's European operations rests with Washington and GM itself, Berlin plays a key role as Opel employs 25,000 workers and the German government will have to stump up billions of euros in loan guarantees.

Details of the plan were not immediately available but the German government is expected to provide some EUR4.5 billion ($6.4 billion) in loan guarantees as well as EUR1.5 billion in temporary loans to keep Opel afloat.

Magna has said it will slash some 10,000 jobs across Europe, including 2,500 in Germany.