Carole Nash Classic Insurance Specialists

Press Report : Geely Automobile declines to up investment in UK cab firm

Automotive News Europe/Reuters, 13th August, 2010

LONDON (Reuters) – Money-losing Manganese Bronze Holdings PLC, which builds London’s black cabs, may need to look for a new investor after Chinese group Geely Automobile Holdings Limited decided not to buy a 14 million pound ($21.83 million) controlling stake.

Geely Automobile, whose privately held parent, Zhejiang Geely Holding Group Limited, bought Swedish carmaker Volvo Car Corp. from Ford Motor Co. earlier this month, had been in talks since March about buying an additional 20 million Manganese Bronze shares.

Geely’s 20 percent stake in the business would have risen to 51 percent if the purchase, based on the Manganese Bronze share price of about 70 pence in March, went ahead.

The decision not to proceed with the placing should not affect the future of our joint venture (with Geely) or international expansion plans,” John Russell, Chief Executive Officer, Manganese Bronze Holdings PLC

“The decision not to proceed with the placing should not affect the future of our joint venture (with Geely) or international expansion plans,” Manganese Bronze CEO, John Russell, said in a statement.

Manganese Bronze said Geely remained committed to Shanghai LTI Automobile Components Company (SLTI), a joint venture between the companies, that builds vehicles in Shanghai for the Chinese and international markets. SLTI would also continue to supply Manganese Bronze with components for its UK manufacturing operations in Coventry, Manganese Bronze said.

Manganese Bronze shares closed 11 percent lower at 45 pence on Thursday, valuing the group at nearly 14 million pounds ($22 million).

[Source: Automotive News Europe/Reuters]

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