General Motors Co. plans to sell control of its German carmaker Adam Opel GmbH to a group led by Canada's Magna International Inc., the German government's preferred bidder.

"The board concluded that this really is the best solution for the long-term viability of Opel," said GM Group Vice President John Smith, the U.S. automaker's chief negotiator.

GM expects to finalize definitive agreements within the next few weeks and conclude the deal before December.

The announcement marks the conclusion of a protracted and increasingly contentious negotiating process that turned into an election issue in Germany, where Opel employs 25,000 people.

The German government, which faces national elections, was particularly eager to preserve German jobs. It has provided cash-strapped Opel with bridge loans and offered $6.4 billion in additional financing assistance, but only if GM concluded a deal with Magna.

GM explored other options, such as keeping Opel or selling a majority stake to Brussels-based industrial holding firm RHJ International SA. But it said Thursday that the board supported a deal with Magna, with whom GM struck a preliminary deal in May.

Some analysts said GM had little choice. "The German government was able to call the shots in the end," said Tim Urquhart, London-based analyst for forecasting firm IHS Global Insight. "They're the major source of financing."

Magna and partner Sberbank will put in $730 million for a combined 55 percent stake in the so-called New Opel. GM will retain 35 percent, and employees will own 10 percent.

Magna anticipates that Opel will be profitable in 2011, at which time it will begin repaying loans. They should be repaid by 2014.

"The hard work over the past two weeks to clarify open issues and resolve details in the German financial package brought GM and its board of directors to recommend Magna-Sberbank," said Fritz Henderson, president and CEO of GM.

"We thank all parties involved in the intensive process of the last few months -- especially the German government -- for their continued support that enables this new venture," Henderson said.

Under the agreement, Opel and its British Vauxhall operations will remain an integrated part of GM's global product development system, with all players benefiting from economies of scale and an exchange of technology and engineering resources.

Opel has been part of GM since 1929 and recently has played a crucial role in developing the architecture for compact and midsize cars for all GM brands. But it is struggling in the cutthroat European market, and the cost of restructuring Opel is estimated at between $3 billion and $4 billion.

For Magna, the deal represents a breakthrough in its effort to become a full-scale automaker. It has produced certain models, such as the BMW X3 small SUV, for its clients.

Sberbank, a Russian-controlled bank, is expected to transfer part or all of its 27.5 percent Opel stake to Russian carmaker OAO GAZ Group.