Chinese auto group Dongfeng Motor is "far" from coming up with a decision over a possible investment French carmaker PSA/Peugeot-Citroen after it was approached by investment banks. Song Hefeng, an official at Dongfeng’s legal and securities affairs department, confirmed that investment banks indeed got in touch with the carmaker regarding PSA and it is doing preliminary research on it.
PSA is mulling selling a stake to joint-venture partner Dongfeng to raise cash for its planned expansion outside Europe, although discussions remain at a preliminary stage, people privy with the matter told Bloomberg earlier this month. A sale could result to the Peugeot family – who currently holds 25.5 percent of the shares -- losing control of the carmaker.
PSA is bound to have four plants in China by the end 2013. The first three sites are operated through a joint venture with Dongfeng and are located in Wuhan.
PSA in July inaugurated its most recent plant, which is expected to boosts the carmaker’s annual production capacity in China by two-thirds to 750,000 vehicles by the end of 2015.
PSA is opening this month the fourth plant in Shenzhen, operated under a joint venture with Changan Automobile Group. The Shenzhen site will build PSA’s upscale DS models and will commence production with the DS5.