Published on : Aug 31, 2015
BAIC Motor, the Chinese automaker is in talks with Daimler AG to acquire stake in the luxury carmaker in Germany, as stated by two sources who are in connection with the matter.
Daimler has a ten percent stake in BAIC motors, the Beijing Automotive Group if China on the Hong Kong stock exchange. To continue the relationship, BAIC in in talks to make investments in the German luxury carmaker, as stated by sources.
If the talks result to be fruitful, Beijing Automotive Group will be the third company in China to make investment in a foreign car manufacturer. The earlier two were SAIC Motors with a share in General Motors and Dongfeng Group with a share in PSA Peugeot Citroen.
In the last couple of years, BAIC and Daimler have come together to form joint ventures in China in pursuit to oversee manufacturing and sales of Mercedes Benz cars in the largest car market in the world.
On completion of the deal, BAIC will stand as one of the top shareholder in Daimler, as reported by Want China Times.
Presently, the investment authority of Kuwait is the single most share holder having biggest share of 6.8%, which is followed by Renault Nissan having a stake of 3.1%.
Prior to this, in an announcement made by Daimler last week, the company signaled it was open to welcome new shareholders for long-term relationship. As stated by Daimler spokesperson, BAIC is the most important partner for the company in China.
The spokesperson further stated that the company wants to remain attractive for entities interested in long-term relationship. Hence, investors from China are also welcome in accordance with this clause.
In the last few years, ties between BAIC and Daimler have strengthened. In December 2013, BAIC acquired 51% stake in a manufacturing joint venture with Daimler based in China.