Automotive News Europe, 3rd December, 2009
SHANGHAI (Reuters) – Volkswagen AG and General Motors Co. partner SAIC Motor, China’s biggest automaker, said on Thursday it suspended its trading on the Shanghai Stock Exchange as it plans a major asset restructuring.
SAIC Motor said it would hold a board meeting before Dec. 9 to discuss the restructuring, and its shares would resume trade after the details of a planned restructuring have been announced.
The trading suspension spurred speculation that the Shanghai-based automaker was in talks with GM or other partners over their Chinese joint ventures.
VW set up 50-50 joint venture Shanghai-Volkswagen Automotive Co. Ltd. 25 years ago. The partners’ product range includes a total of 11 models ranging from the VW Polo, Santana and Touran to the Skoda Fabia, Octavia and Superb.
SAIC Motor and GM are 50-50 partners in Shanghai GM, the maker of Cadillac, Buick and Chevrolet models, while SAIC-GM-Wuling is a three-way tie-up between SAIC Motor, GM and Liuzhou Wuling Automobile, which makes popular minivans and small trucks.
GM, which currently holds a 34 percent stake in SAIC-GM-Wuling, has been seeking to increase its stake in the venture – SAIC Motor owns 50.1 percent and Liuzhou Wuling 15.9 percent.
SAIC Motor and GM have also been exploring business opportunities in India, another major auto market with great potential, SAIC Motor President Chen Hong told reporters recently. SAIC Motor’s spokeswoman declined to comment on market speculation.
GM said in a statement it was constantly holding discussions with its partner to ensure that both companies were improving and prepared for the future.
SAIC Motor’s shares have more than quadrupled this year, leading a roughly 80 percent gain on the benchmark index.
[Source: Automotive News Europe/Reuters]
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