Expect to see more of the same as Chinese enterprises are being encouraged to invest outside of China. Key investments have already been made in oil and gas. Ive precised the following article...
Reutersreport Shanghai Automotive Industry SAIC.L , China's largest carmaker, plans to buy privately held British automaker MG Rover in a bold push to grab a Western beachhead and boosting its ambitions to become the world's sixth-largest automaker by taking an initial equity stake in MG Rover, the size of which was still under discussion.The report goes on to give the impression that negotiations are still ongoing rather than a deal has been done.
SAIC also sees MG Rover's 1,247 western European dealers as a point of entry into Europe.
MG Rover, an independent car maker, has been struggling to break even after being sold four years ago by Germany's BMW BMWG.DE for just 10 pounds. Britain's seventh-largest private equity group, Phoenix Venture Holdings, owns MG Rover now.
SAIC signed a cooperation agreement with Rover in June but provided no details, saying the companies had yet to receive central government approval.
State media in China quoted sources close to Shanghai Auto as saying the company would buy a stake in Rover and start producing Rover products in China.
Shanghai Auto is already the main Chinese partner of both General Motors GM.N and Volkswagen VOWG.DE
The company aims to become one of the world's top six automakers by 2010 and has said it wants to list its stock overseas to raise a reported $2 billion.In July it agreed to buy South Korea's Ssangyong Motor 003620.KS , and executives have said Shanghai Auto would keep seeking overseas acquisitions and develop its own brand.
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