General Motors said that it will cash out $51 million to buy an additional 10 percent stake in the Chinese joint venture it owns with SAIC Motor Corp. and Liuzhou Wuling Motors Co. Ltd. GM currently owns 34 percent of SAIC-GM-Wuling Automotive Co. and will acquire the stake from Wuling, which will end up keeping 6 percent. GM said that it will provide technical services to Wulwing through 2013.
SAIC owns the other 50 percent of SGMW, which makes mini-commercial vehicles and passenger cars in China. The deal is subject to regulatory approval in China.
As a part of it initial public offering, GM is set to sell equity to SAIC, sources familiar with the matter said. The Chinese market is the fastest-growing global market by volume of vehicles sold.
SAIC Motor Corp. and General Motors recently signed a non-binding memorandum of understanding on strategic cooperation and the development of new energy vehicles.
– By: Omar Rana
Source: Automotive News (Subscription Required)