New York  - General Motors may decide not to sell struggling European daughter-company Opel and instead try to raise 4.3 billion dollars to restructure Opel itself, the Wall Street Journal reported on Tuesday.

GM's new board - installed with the support of US President Barack Obama after the company emerged from bankruptcy - has asked GM's management to draft a funding plan to keep Opel by September, the Journal reported, citing sources close to the company.

Previously, the company had been trying to negotiate a sale of Opel with a number of European partners since May.

The move came after months of complex negotiations between GM, the German government which has provided a bridging-loan to see Opel through the sale process, and two main bidders, an Austrian-Canadian- Russian consortium and Belgian-based RHJ International, an investment group.

The Journal cited three people close to the matter as saying that GM Chief Executive Frederick "Fritz" Henderson "has been charged with putting the funding plan in motion by the next GM board meeting in early September."

On Friday GM's new board declined to approve a revised deal offered by Magna, the preferred choice of the German government and German unions. Opel employs some 25,000 people in Germany, around half of its total European workforce.

Magna's offer had been favoured primarily because it was seen as involving fewer job losses.

On Monday a spokesman for the German Chancellor Angela Merkel said that a high-level meeting between a senior GM executive and the German government would take place in Berlin this week, as political pressure to resolve the Opel issue ahead of elections in Germany on September 27 rises.

The Russian government would also be angered by a GM decision not to sell Opel, as Russian Prime Minister Vladimir Putin has repeatedly described the Opel sale to the Magna consortium as good for the Russian car industry.

The purported Magna deal involves Russian state-backed bank Sberbank, and would see technology and production capacity transferred to Russia.

The Journal said that the US Treasury Department was maintaining a distance from GM's decision on Opel. (dpa)