SAIC acquires parent company’s 6% stake in GM’s South Korean unit

Article by Christian A., on April 6, 2011

SAIC Motor Corp. has recently announced several acquisitions, including buying its parent firm’s 6% stake in the South Korean unit of GM. Shanghai-based SAIC, China's largest automaker, said that it will issue 1.73 billion new shares to pay for this purchase.

SAIC Motor also entered a deal to buy parts makers and other businesses from its parent for 32 billion yuan ($4.9 billion) in stock in order to have control of the upcoming models’ supplies and speed development.

SAIC, which builds cars in China with General Motors Co., said that this acquisition may assist with its projects involving electric and hybrid vehicles. This acquisition is timely since the government is strongly supportive of cars that offer high economy in order to reduce pollution as well as lessen the need to import fuel to China.

To boost financial transparency, China's state-controlled companies have been urged to sell assets to listed units. Han Weiqi, an analyst at CSC International Holdings Ltd. in Shanghai, said that by taking a stake, SAIC will get the chance to work directly with parts suppliers.

Weiqi also believes that SAIC made this deal to respond to government’s thrust for reorganization in the auto industry.

As a result of the deal, SAIC will now hold the 60% stake that its parent Shanghai Automotive Industry Corp. has in Shanghai-listed parts maker Huayu Automotive Systems Co. SAIC will also now own export and logistics companies as well as businesses that are developing alternative-energy vehicles.

Topics: saic

If you liked the article, share on:

Comments

Recommended

In 2014, Jaguar Land Rover’s Special Vehicle Operations revealed the F-Type Project 7. At that time, it was said to be the fastest accelerating road car carrying a 5.0-liter Supercharged...
by - May 29, 2017
There is an ongoing rumor going around the automotive community, and it’s aimed at BMW. The rumor? The German marque has reportedly axed the i5 Electric vehicle concept. These supposed...
by - May 29, 2017
Volkswagen's yearly Worthersee affair that happens in Austria is considered a hotbed for all types of cars from the German company's long and renowned history. Most of the gathering features...
by - May 29, 2017
Behold, the Rolls-Royce Sweptail! The Sweptail is probably the biggest two-seater car that has ever been built. It may look odd at first glance, and you may not be fond...
by - May 29, 2017
BMW just keeps on getting bigger and bigger, in terms of their lineup I mean. Just after unveiling the 8 Series Concept, they are now teasing us with an M8...
by - May 29, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries