A joint GM/Fiat statement said the companies were ready to begin discussions regarding the acquisition of Daewoo Motors' passenger vehicle assets and related businesses.
GM signalled its ambitions in Asia by doubling its stake in Suzuki to 20%.
Analysts believe GM, which owned half of Daewoo Motors until 1991, is in a strong position to negotiate a lower price than Ford's original proposal – possibly as low as £2bn. Ford pulled out of exclusive talks last month after tabling a £4.6bn bid.
GM, though, has been downgraded on earnings estimates by some analysts because of inventory build-up, price incentives and slowing European sales. The euro's weakness is also expected to hit earnings this year. * Staff at Daewoo's Worthing technical centre in West Sussex were expecting to be paid this week after management secured funds.